The RBI report says that the gross NPA of the public sector bank may increase by 650 basis points. In July-September, the gross NPA of public sector banks can increase to 9.7%.
Submerged debt of Indian banks can increase to 13 percent of their balance sheet. RBI has said in the new version of the Financial Stability Report that by September 30, 2020, the bad loans will increase to 13.5% of the banks’ bank sheets.
It was 7.5% in September 2019. It can reach 14.8 percent even in very bad conditions. If the situation is bad then this situation can only come in the second quarter of the financial year 2021-22. If this happens, the bad loan will reach the worst position of two decades.
NPA is coming down but the situation is still not very good
However, RBI has said in its report that the situation of NPA is constantly improving. It has been steadily decreasing for the last two years. It was 7.5 per cent in July-September 2020. Even the increase in slippage ratio ie fresh bad loans has decreased. It decreased to 0.15 percent in September.
NPAs of public sector banks will increase more
The RBI report says that the gross NPA of the public sector bank may increase by 650 basis points. In July-September, the gross NPAs of public sector banks can increase to 9.7%, while in July-September (2021-22) it can reach 16.2%. NPAs of private banks may rise from 4.6 per cent to 7.9 per cent during this period.
Nidhi Malviya is fun loving girl. She writes at NoobFeeds about various topics related to Finance, Technology, Business etc.