Mere headline numbers do not tell the complete story. What is interesting is how banks have brought down their dud loans. Read on
The asset quality of the banking sector will also benefit from the proposed sale of NPAs to the National Asset Reconstruction Company Ltd (NARCL), the rating agency said.
At the end of Q3, a whopping 41 percent of corporate debt is with companies whose earnings are less than their interest outgo. Credit Suisse's MD and Head of Research Ashish Gupta shares his detailed analysis with CNBC-TV18's Latha Venkatesh on a special show - Indianomics.
In an interview with CNBC-TV18, Melwyn Rego, MD and CEO of BOI said that net addition to gross non-performing assets (GNPAs) is around Rs 388 crore and sees FY17 slippages to be at Rs 17,500 crore.
The report, however, warned that if macroeconomic conditions deteriorate, the GNPA ratio of scheduled commercial banks (SCBs) may increase further and under a severe stress scenario it could rise to around 6.3 percent by March 2016.
The profitability of banks is likely to come under pressure in the coming quarters in view of deteriorating asset-quality of banks mainly on account of the economic slowdown, RBI said in a report.