April 28 (Reuters) - Indian shares declined on Tuesday, as higher crude prices hurt sentiment and banking stocks came under pressure after the Reserve Bank of India's final credit-loss guidelines.

Brent crude rose above $110 a barrel as efforts to end the Middle East war appeared to have stalled. [O/R]

Higher oil prices are a negative for India, the world's third-largest crude importer, due to heightened inflation risks and pressure on economic growth and corporate earnings.

The Nifty 50 fell 0.4% to 23,995.70, while the BSE Sensex shed 0.54% to 76,886.91. 

Both benchmarks rose about 0.3% in the first hour, but reversed course ahead of the monthly derivatives expiry.

Ten of the 16 major sectors logged losses. 

High-weight banks, private banks and state-owned lenders lost 1.5%, 1.2% and 2.2%, respectively, after the RBI's new rules.

"The market has taken cognisance of the fact that the upcoming expected credit-loss norms could erode profitability due to higher Stage 2 provisioning," said Saurabh Jain, assistant vice president of retail equities, SMC Global.

Under the norms, Stage 2 assets are loans that have seen a significant increase in credit risk but are not yet credit-impaired.

"PSU banks are likely to feel a sharper pinch than their private-sector peers." 

Most private-sector banks already provision conservatively for overdue loans and maintain contingent buffers, while state-owned lenders typically do not. 

The new norms could raise provisioning requirements more sharply for PSU banks.

Meanwhile, top carmaker Maruti Suzuki fell 2.5% after posting a quarterly profit drop due to higher raw material costs. Auto index lost 1%.

Coal India climbed 3.2% after reporting a larger-than-expected quarterly profit.

ONGC and Oil India added 5.4% and 4.5%, respectively, as higher crude prices boosted the earnings outlook for upstream companies.

On the flip side, the broader small-caps and mid-caps rose 0.4% and 0.3%, aided by upbeat earnings in key constituents.

(Reporting by Bharath Rajeswaran in Bengaluru; Editing by Sumana Nandy, Nivedita Bhattacharjee and Harikrishnan Nair)

By Bharath Rajeswaran