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Bank’s NPA to improve to decadal low of 3.8pc by FY24-end
April 04, 2023
Crisil said a major factor influencing the bank NPAs is the improvement in the high-value corporate loanbooks, where the gross NPAs are slated to come below 2 per cent. Corporates have been reducing their leverage through a string of measures, including prepayment of loans as well.
Additionally, strengthened risk management and underwriting is also helping the lenders towards lowering the NPAs, the agency said.
When asked about the growing trend of writing unsecured loans in the retail segment, the agency’s deputy chief rating officer Krishnan Sitaraman said they occupy a very small proportion of the overall loans.
He said 26 per cent of the overall banking industry exposure is to the retail segments, of which half is home loans and one-fourth is vehicle. All the remaining loans, including the unsecured credit card and personal loans fall in the remaining one-fourth of the retail book, he explained.
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