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Bad loans: Banks' gross NPAs may rise to 9.8% by March 2022, says RBI report

The FSR published in January this year had said banks' GNPAs may rise to 13.5% by September 2021, under the baseline scenario (Photo: Bloomberg)Premium
The FSR published in January this year had said banks' GNPAs may rise to 13.5% by September 2021, under the baseline scenario (Photo: Bloomberg)

Macro stress tests indicate that the gross non-performing asset (GNPA) ratio of banks may increase from 7.48% in March 2021 to 9.80% by March 2022 under the baseline scenario, the Financial Stability Report released by RBI said

MUMBAI : Gross non-performing assets (GNPAs) of banks may rise to 9.8% by March 2022 under a baseline scenario, from 7.48% in March 2021, according to the Financial Stability Report (FSR) released by the Reserve Bank of India.

Under a severe stress scenario, GNPA of banks may increase to 11.22%, it added.

"Macro stress tests indicate that the gross non-performing asset (GNPA) ratio of banks may increase from 7.48% in March 2021 to 9.80% by March 2022 under the baseline scenario," the FSR released on Thursday showed.

The FSR published in January this year had said banks' GNPAs may rise to 13.5% by September 2021, under the baseline scenario.

The latest FSR, however, said banks have sufficient capital, both at the aggregate and individual level, even under stress. 

Within the bank groups, public sector banks' (PSBs) GNPA ratio of 9.54% in March 2021 edging up to 12.52% by March 2022 under the baseline scenario is an improvement over earlier expectations and indicative of pandemic proofing by regulatory support, it added.

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