Synopsis
The ratings agency forecasts total stressed loans from retail to rise to 4.7% in March 2022 from 1.60% in March 2021 led by slippages in unsecured loans especially from private sector banks.
Agencies
Gross NPAs for the banking system will increase to 10.1% in March 2022 from 8.8% at the end of the current fiscal but higher pre operating profits and provision coverage ratios will help banks manage the higher stress, Ind-Ra said.
Mumbai: Stress in retail loans could triple by the end of FY22 due to a slowdown in income growth and slower pace of job creation in the service sector, credit ratings firm India Ratings & Research (Ind-Ra) said. It estimated that stressed loans from retail advances could rise to 4.7% of the total in March 2022 from 1.60% in March 2021, led by slippages in unsecured loans especially at private sector banks.
Inflation measured by the Consumer Price Index (CPI) eased to 4.59% in December, more than what the market expected, compared with 6.93% in November. Core inflation, which does not factor in food and oil prices softened to 5.2% against 5.4% earlier.