Analysis Of RBI’s Financial Stability Report, Non-Performing Asset: CareEdge
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CareEdge Research Report
The Reserve Bank of India’s Financial Stability Report released yesterday presents a rather satisfactory picture of the Indian banking system. Probably the most important indicator that is used to check on the health of the banking system is the non-performing asset related number.
Here the system does well with the ratio of gross non-performing asset being 6.9% for September 2021. This is contrary to expectations last year when one expected a double digit GNPA number given the Covid-19 environment.
In terms of sector wise GNPA there has been an improvement in most of the segments where the numbers were high:
Construction is down from 21.5% in September 2020 to 21.1% in September 2021,
Gems and Jewellery from 24.1% to 20.7%,
Engineering from 19.4% to 18%,
Food processing moved up from 13% to 14.2%,
Mining from 15.6% to 14.3%,
Infrastructure from 11.9% to 9.2%,
Textiles unchanged at 11.7.
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