NBFCs Add Risk To Slowing Economy
Banks are significantly upping lending to risky NBFCs, forcing RBI to sound an alarm
Banks are significantly upping lending to risky NBFCs, forcing RBI to sound an alarm
RBI’s financial stability report says the SMA share in retail advances for PSBs stood at 9.4% as of March 31, 2023
Profit of Indian lenders grew 38.4% in 2022-23, led by strong growth in net interest income and significant reduction in provisions
The RBI says the gross NPA ratio of the scheduled commercial banks continued to decline and stood at a seven-year low of 5% in September 2022.
RBI says the Indian economy has been consolidating a recovery led by robust revival of agriculture and services, and stable corporate performance.
According to the RBI, the gross NPA ratio of all scheduled commercial banks may increase from 7.5% in September 2020 to 13.5% by September 2021, and even escalate to 14.8% in severe stress scenario.
The Reserve Bank of India’s latest financial stability report says the banking sector continues to remain stressed.