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ET Intelligence Group: The aggregate bad loan provisioning by banks fell sequentially for the fourth consecutive quarter in December though some of them increased COVID related provisioning. For a sample of 28 banks, provisioning for bad loans or nonperforming assets (NPA) fell by 27.5% sequentially to Rs 24,149.7 crore in the December quarter. It was the lowest in the seven quarters under observation.
The loan loss provisioning by banks has been benign in the current fiscal year so far on account of various schemes launched by the central bank to reduce the impact of the pandemic. “Bank NPAs this year would tend to be a bit nebulous given the various forbearance dispensations that have been made besides the restructuring schemes that have been introduced,” noted CARE Ratings in a report.