State-owned banks wrote off bad loans worth Rs 29,000 crore in the December 2022 quarter (Q3FY23), higher as compared with Rs 23,000 crore in the corresponding quarter last year, as part of a clean-up exercise, according to a CARE Ratings report.
The write-offs by public sector banks (PSBs) in April-December 2022 were Rs 81,000 crore, which were lower than the Rs 90,000 crore in the year-ago period, CARE Ratings said.
Sanjay Agarwal, senior director of CARE Ratings, said a lot of it was driven by regulations, and assets that had 100 per cent provision coverage were written off. There is recovery happening over the years.
State-owned Bank of India wrote off Rs 2,522 crore in the the December 2022 quarter, compared with Rs 1,883 crore in the previous quarter. However, the write-offs were much lower than the Rs 4,900 crore in Q3FY22.
Banks’ net NPAs declined 32 per cent to Rs 1.15 lakh crore at the end of December 2022 and sequentially they dropped from Rs 1.28 lakh crore at the end of September 2022.
In December 2022, the RBI said banks’ gross NPA ratio has fallen to a sever-year low of 5 per cent and the banking system remains sound and well-capitalised. In the 26th issue of the Financial Stability Report (FSR), the RBI also said the global economy is facing formidable headwinds with recessionary risks looming large.
The interplay of multiple shocks has resulted in tightened financial conditions and heightened volatility in financial markets, it had pointed out.
Read all the Latest Business News here
Comments
0 comment