Indian banks’ financial position has stayed robust, marked by the sustained expansion in loans and deposits, while their gross bad loan ratio has dropped to multi-year lows, a central bank report showed on Thursday.
Banks’ gross non-performing assets ratio (NPA), or the proportion of bad assets to total loans, slipped to an over-13-year low of 2.5% at end of September from 2.7% at end-March, the Reserve Bank of India (RBI) said in its ‘Trend and Progress of Banking’ report.
Net bad loans of banks fell to 0.57% of total loans at September-end, from 0.62% at end-March, driven by stronger loan-loss buffers, the RBI report
The asset quality of non-bank finance companies (NBFCs) also improved further in 2023-24 amid a sustained double-digit balance sheet growth, the central bank said.
Over the past year, the RBI has warned the financial sector against “all forms of exuberance”, tightened rules for credit card and personal loans, made it more expensive for non-banking finance companies to borrow from banks and imposed restrictions on non-compliant lenders. Read more
Source: Economic Times