Despite the slowdown in the country's economic growth rate, the financial system remains stable. This information has been given by the Reserve Bank of India in its latest Financial Stability Report (FSR). According to the RBI report, banking sector liquidity has improved after the re-capitalization of public sector banks (PSBs) by the government. However, apart from global and domestic economic uncertainties, the risk of political developments remains.
According to the RBI report, the credit growth of commercial banks (SCBs) on an annual basis was 8.7 percent in September 2019. However private sector banks have recorded double digit credit growth. During this period, the growth of private sector banks was 16.5 percent. The report stated that the gross non-performing assets (GNPA) ratio of commercial banks remained stable at 9.3 per cent between March and September 2019. Apart from this, it has been told in the report that the central bank has accepted some major recommendations of the task force. Along with this, strict action has been taken on issues related to the functioning of banks and NPAs.
NPA Stable at 9.1 Percent
According to an RBI report, the gross NPA (debt) debt ratio of banks remained stable at 9.1 per cent in the quarter ended September 2019. The level of NPA was the same in 2018-19. On an annual basis, there is good improvement on the NPA front. While the NPA ratio was 11.2 per cent in 2017-18, it came down to 9.1 per cent in 2018-19. At the same time, the net NPAs of all commercial banks fell by almost half to 3.7 percent in 2018-19 compared to the previous year, compared to 6 percent in the previous financial year.
