NBFCs expect higher credit loss on COVID-19 woes, says EY study
Non-Banking Financial Companies (NBFCs) are expecting higher credit loss as well as an increase in provision coverage rates, mainly due to the impact of the coronavirus pandemic
Non-Banking Financial Companies (NBFCs) are expecting higher credit loss as well as an increase in provision coverage rates, mainly due to the impact of the coronavirus pandemic, according to a study.
The study by leading consultancy EY is based on an analysis of the standalone financial statements of 42 NBFCs, including 14 Housing Finance Companies (HFCs), for the year ended March 31, 2020.
The companies have reported an increase in Expected Credit Loss (ECL) allowance by 33 per cent and an overall increase in provision coverage rate by 26 per cent as at 31 March 2020 compared to the year ended 31 March 2019 .