Mumbai: Banks tend to see the increase in gross non-performing assets (NPA) to 8-9% of the total loan at the end of this fiscal year from 7.5% last year, Cistern Agency Crisil said in a report on Tuesday.
Rises will be led by retail clients and micro, small and medium segments (MSMEs), said Sitanaman Krishnan, senior director and deputy deputy ranking events, noting that they represent 40% of total bank loans.
“Stress assets in this segment are seen up to 4-5% and 17-18%, with the end of this fiscal year (March 2022).
The numbers will take place higher but for writing, especially in unsafe segments,” Sitchaman said.
Last year The Reserve Bank of India (RBI) allowed banks to offer a six-month moratorium for all small borrowers.
This then allows lenders to offer a one-time loan restructuring facility to help prevent bad loans and allow more borrowers to pay their debts.
Apart from these steps, stress assets in the retail segment will rise, with a home loan which is the biggest segment that is most unrealized and unsafe loan is the worst, said Crisil.
The company segment is expected to be more resilient because most of the stress in the company’s portfolio has been recognized during the asset quality review initiated by the RBI in 2015, Crisil said.
The agency said the performance of the restructured portfolio would require close monitoring but mosquito nets from restructured books are expected to be lower this time.
“The trend has recently shown that the proportion of a reasonable borrower, especially on the retail side, has begun to make additional payments because their cash flow increases, said Subha Sri Narayanan, Director of the Crisil ranking.” MSMEs, may take longer to stabilize and we.
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Banks face a bad loan increase to 8-9% of loans: Crisil
