close

News WrapGet Handpicked Stories from our editors directly to your mailbox

Banking sector worry: Bad loans rise 15% in June

Reserve Bank of India's (RBI) data has revealed that stressed loans have crossed $ 138 billion (approx Rs 8,71,746 crore)  in June 2016, an increase of 15% in just six months, data accessed by Reuters showed. 

Banking sector worry: Bad loans rise 15% in June
From the total bad loans, public sector banks (PSBs) account for about $122 billion of total stressed loans, while private banks hold $ 14 billion. Photo: Pixabay
Written By: ZeeBiz WebTeam
Updated: Tue, Oct 11, 2016
09:15 am
Mumbai, ZeeBiz WebDesk
RELATED NEWS
RBI crackdown on NPA: What is Reserve Bank's 'Prudential Framework' plan to deal with stressed assets RBI crackdown on NPA: What is Reserve Bank's 'Prudential Framework' plan to deal with stressed assets
Syndicate Bank hopes to recover Rs 1,500 crore from non-performing assets Syndicate Bank hopes to recover Rs 1,500 crore from non-performing assets
Provision coverage ratio of PSU banks on the rise, crosses 66 pc Provision coverage ratio of PSU banks on the rise, crosses 66 pc
Bad loans: RBI reveals top 20 defaulters of PSBs account for Rs 2.36 lakh crore Bad loans: RBI reveals top 20 defaulters of PSBs account for Rs 2.36 lakh crore

There is no sign of relief for Indian banking sector when it comes to stressed assets. 

Reserve Bank of India's (RBI) data has revealed that stressed loans have crossed $ 138 billion (approx Rs 8,71,746 crore)  in June 2016, an increase of 15% in just six months, data accessed by Reuters showed. 

This means a clean-up effort will take longer and cost more than expected, Business Standard said. 

From the total bad loans, public sector banks (PSBs) account for about $122 billion of total stressed loans, while private banks hold $ 14 billion, according to Reuters. 

To curb these stressed loans, the central bank has been adapting various measures such as asset reconstruction companies (ARC)  and Scheme for Sustainable Structuring of Stressed Assets (S4A). 

The central bank also issued various guidelines on large corporate borrowers.  

But considering the above conditions, looks like RBI along with government are far away from success. 

RBI's newly appointed Governor Urjit Patel said the regulator will deal with the bad loans situation with "with firmness but also with pragmatism".