The gross non-performing asset ratio of banks may increase to 9.9 per cent by September 2020 from 9.3 per cent in September 2019, according to an RBI report.
The gross NPA ratio of banks stood at 9.3 per cent in March 2019.
“The stress tests indicate that under the baseline scenario, the GNPA ratios of banks may increase to 9.9 per cent by September 2020, due to change in macroeconomic scenario, marginal increase in slippages and the denominator effect of declining credit growth,” RBI said in its Financial Stability Report (FSR).
The report said state-run bank’s GNPA ratios may increase to 13.2 per cent by September 2020 from 12.7 per cent in September 2019, whereas for private banks it may climb to 4.2 per cent from 3.9 per cent, under the stress scenario.
The foreign bank’s gross bad loans may increase to 3.1 per cent from 2.9 per cent in September 2019.
The report said banks net non-performing assets (NNPA) ratio declined in September 2019 to 3.7 per cent, reflecting increased provisioning.
The aggregate provision coverage ratio (PCR) of all banks rose to 61.5 per cent in September 2019 from 60.5 per cent in March 2019.
The report showed that the share of large borrowers in banks’ total loan portfolios and their share in GNPAs was at 51.8 per cent and 79.3 per cent, respectively, in September 2019, lower compared to the 53 per cent and 82.2 per cent, respectively in March 2019.
The top 100 large borrowers accounted for 16.4 per cent of banks’ gross advances and 16.3 per cent of GNPAs.