RBI deputy governor reasserts March 2017 deadline for banks to clean up balance sheets
In October, the bank had said it would deal with non-performing assets in a pragmatic manner.
Reserve Bank of India Deputy Governor NS Vishwanathan on Tuesday said March 2017 would remain the deadline for banks to clean up their balance sheets. Vishwanathan said the rise in the number of stressed assets was coming down across several sectors, PTI reported.
Bad loans in the infrastructure sector were currently close to between 16%-17% of total advances, Vishwanathan said at a conference organised by the Associated Chambers of Commerce in India. In August, RBI Deputy Governor SS Mundra had said the level of stressed loans in the banking sector had risen to 12% as non-performing assets rose to 8.7% in the June quarter of the financial year, The Financial Express reported.
Indian banks reported a 96% spike in non-performing assets to Rs 6,29,774 crore in June 2016 from Rs 3,20,553 crore during the same month last year. The data was made available after the Reserve Bank of India ordered an asset quality review.
In October, RBI Governor Urjit Patel said that that 65% of the financial stress in public-run banks was contributed by five sectors, and that the central bank would deal with the situation pragmatically.