Several issues with this chain of thought… 
First and foremost,
the amount being lent out as housing loans by these “leading banks”
what % is that to the total amount lent out by banks in other forms at higher returns?
One likely reason to justify the behavior of banks described in the above screenshot,
is that these “leading banks” are currently incentivizing relatively lower-risk loans
to ensure that the risks associated with their loans stay within the thresholds set by RBI.
Presumably these banks have managed to lend out a wide-variety of delinquent loans / high-risk loans / NPAs that have (or even continue to) provide the banks way higher returns, but they are pushing the risk factors the banks are exposed to, beyond the thresholds set by RBI, and thus the banks need to adjust/account for it.
Other reasons would exist too.
Assets and liabilities are rarely matched perfectly in terms of duration,
The above could be a “widening” Duration gap, not the end of the world for a “leading bank”.
Immediate thought is - What does Mr. Kotak have to gain (either financially or otherwise)
by pushing this narrative on his audience, at this point of time? 
From goods and services provided, and any actual productivity improvements.
Not from simply financialisation.
Well, some of it will.
Maybe a smaller share of the overall growth comes from financialization, if the recent trends hold.
Recent related posts:
- The Flip Side of Easy Loans in India (JAN 2025)
- Why Home Loans Aren’t Flying Anymore (FEB 2025)
- Why RBI Is Making Borrowing Easier Again! (MAR 2025)