The government needs to lift the lockdown entirely now or else the country will face severe implications, Amitabh Chaudhry, Chief Executive Officer (CEO) of Axis Bank, said on April 29.
India has had the strictest lockdown with no major fiscal support like other countries, said Chaudhry, adding that it will take 6-9 quarters for revival of the economy.
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"We know that the lockdown will take time to get lifted, we know that the economic activity will take a lot of time to come back to normal. In that scenario, it is almost a given that a number of corporates and individuals will go through a severe stress and some will become non-performing," Chaudhry told CNBC-TV18.
The private sector lender on April 28 reported a surprising loss of Rs 1,388 crore for the quarter ending March 31, as provisions rose sharply compared to a year ago.
Also read: All good for Axis Bank in Q4, but COVID-19 uncertainty shadows future outlook
Despite a healthy 19 percent net interest income growth over the last year, 15 percent growth in its loan growth, and a 17 percent rise in operating profit, the bank posted a loss because it set aside Rs 7,730 crore as provisions and contingencies in Q4 FY20 against only Rs 2,711 crore during the previous year.
The steep rise in provision is partially due to COVID-19 related uncertainties, and a clear indicator of the times ahead.
The CEO said that the retail part of the business was practically shut and that no one is borrowing.Source: CNBC-TV18