Beginning of the end of the NPA cycle: Rashesh Shah

The non-performing asset (NPA) formation has dented the corporate credit growth, especially in the infrastructure investment space, says Rashesh Shah, Chairman and CEO of Edelweiss Financial Services.

Speaking to CNBC-TV18’s Yash Jain, Shah said that RBI’s asset quality restructure (AQR) process has been path breaking as it has helped quantify NPAs.

He believes that we are at the beginning of the end of the NPA cycle.Below is the transcript of Rashesh Shah's interview with CNBC-TV18.Q: What is your key focus areas going forward?We are fairly positive on that, the growth continues for us because a lot of our focus has been on restructuring and revival. So, lot of our focus is on restructure, revive, resolve and then recover. Q: One of the major issues which is really dented credit growth is the formation of NPAs. With the recent cleanup do you think that the worst is behind us or do you think there is more pain left? A: The NPL issue has affected only corporate credit growth especially in the infrastructure investment space. We are still seeing a lot of credit growth in the working capital space even for corporate. I do believe that the AQR process started by RBI about a year ago has been really path breaking because it has allowed people to quantify how big is the NPL problem because without quantification everybody was creating their own estimates, there was lot of scare mongering going on. Everybody was over estimating how big is the problem. It is a problem but I think with the AQR process now at least there is a boundary around the problem and we do believe that we are at the beginning of the end of the NPL issue.