Bad loans will shrink in March- Mumbai: RBI is in constant touch with the banks to record the full figure of bad loans in their book accounts, worse times … RBI is in constant pressure on the bank to record the full figure of bad loans in its book accounts, the worst scenario is likely to have passed, as the banking industry can register a decline in non-performing assets in the current fiscal. This may be the first time since 2015. In 2015, the RBI started strictly in this matter.
Bad loans will shrink in March – RBI said
RBI estimates that by March 2019, the gross bad loan figure will drop to 10.3 percent of the total loan. This figure was 10.8 percent at the end of September 2018 and 11.5 percent in March 2018. Net NPA ratios have also declined during this period.
In its 18th Financial Stability Report, the RBI said, “The burden of impaired assets is indicating a possible recovery. Gross NPA ratios of both public and private banks have seen a decline on a half-year basis. This has happened for the first time since March 2015. ” This is the first financial stability report after becoming the governor of Das’s RBI governor. “The Banking balance Indicator specify that the Better quality of the property of the banks has refined, although profitability is declining.”It said.
The RBI started Asset Quality Review in 2015. From this, the banks had to register many loans as bad assets, while they were showing them as standard assets. Because of this act of banks, many companies have been restructuring their loans on such conditions, which were impossible to complete. These companies were also continuously going to default.
Although the changes made to the RBI strictly now are good news for the government. The government wants to increase the pace of credit delivery to increase economic activity and create more employment opportunities. Financial Services Secretary Rajiv Kumar had told ET last week that the quantity of bad loans of government banks is declining and they have registered most of their wealth assets in the books of accounts.
Bad loans will shrink in March | RBI Latest Statement
more employment opportunities. Financial Services Secretary Rajiv Kumar had told ET last week that the quantity of bad loans of government banks is declining and they have registered most of their wealth assets in the books of accounts.
It was also stated in the report that even though the overall situation is improving, but in the case of a strait test, the rise in bad loans will cause many banks to suffer and they will go below the minimum capital requirements.
A Report said, “Sensitivity analysis specify that if the capital was not made available and the banks did not refine their performance, then 18 scheduled commercial banks including all the government. banks brought under the Promoted Corrective Action Act may have GNPA ratio Due to the 2 standard deviation in the Capital to Risk Weighted Ratio, it is possible to maintain the required level.