The worst is over for the Indian banking sector is the word coming in from global rating agency Moody's Investor Service. The agency believes there will be a sharp slowdown in the addition of stressed assets in FY16, helped by an improvement in the macroeconomic environment.
The reason why we are creating incremental Rs 2,500 crore provision is because as we transition to a bank, we want to make sure that the bank‘s balance sheet is completely protected against known risks, said Vikram Limaye, MD & CEO, IDFC.
Mahindra and Mahindra Financial Services reported poor set of earnings in the quarter ended December 2013. Standalone profit after tax of the non-banking finance company fell 18 percent year-on-year to Rs 164 crore dented by higher provisions indicating stress on asset quality.
Given the amount of foreign funds that Japan has attracted year-to-date, the market should have not been totally surprised by the fall seen on Thursday.
Ananda Bhoumik, India Ratings & Research is of the view that the NPL for PSU banks may see a peak in March or June and then a gradual reduction thereafter.