Press Esc to close
Sunday 28 May 2017
News updated at 2:09 PM IST

More measures to rein in NPAs on the anvil: Subbarao

Chennai, August 1, 2013, PTI 23:00 IST

PSBs at 3.8% of gross NPAs end-March

D Subbarao
Concerned over rising bad loans, the Reserve Bank on Thursday said it will take more measures to check non-performing assets (NPAs) of the public sector banks.

"We are going to put in more measures to see that NPA level is controlled across the asset quality of banks. It is is very very important for credit to continue to go to productive sectors," RBI Governor D Subbarao said while delivering the 5th R Venkataraman Endowment Lecture here.

RBI, in the past, has taken some steps in this regard including increase in provisioning norms and tightening norms for restructuring.

Subbarao noted that public sector banks have high NPAs than private sector banks.
"It is true that NPAs in public sector banks is higher because their decision variables are different, and therefore, NPAs are higher than private sector banks," he said.
"In the Reserve Bank, we are concerned about it. It is a growing concern. Even last Tuesday, when we met at the bank, we spoke about this," he added.

Gross NPAs of the public sector banks (PSBs) were the highest and stood at 3.8 per cent of the system at the end of the March quarter, followed by foreign lenders.
However, the old private sector banks recorded the highest recovery during the period, at 21.2 per cent, followed by PSBs at 9.1 per cent.

Financial Stability Report (FSR) released by RBI blamed seasonality factors for the higher slippages in the March quarter, which traditionally sees higher bad loans.
The report said the loan recast too declined in the March period to 5.7 per cent from 5.9 per cent in the September quarter.

Asked about high cost of agriculture loan in the country, Subbarao said "the answer is that the cost of credit is determined by the riskiness. And banks attach risk to agricultural loan perhaps and therefore, the cost is high."

“As an economy, as public policy makers,” he said, "we are also concerned about credit offered at reasonable rates to economically productive activities like agriculture, education loans and small and medium enterprises."

"There are several ways of doing it. The government for example, is now giving subvention on agricultural credit," he added.

Go to Top

Photo Gallery
Prime Minister Narendra Modi shakes hands with his Mauritian counterpart Pravind Kumar Jugnauth...

Prime Minister Narendra Modi shakes hands with his Mauritian counterpart Pravind Kumar Jugnauth...

Congress president Sonia Gandhi pays tributes to first prime minister Pandit Jawaharlal Nehru...

Congress president Sonia Gandhi pays tributes to first prime minister Pandit Jawaharlal Nehru...

Congress vice president Rahul Gandhi meeting the victims of Saharanpur caste violence at...

Congress vice president Rahul Gandhi meeting the victims of Saharanpur caste violence at...

A Policeman in action against stone pelters during violent clashes which erupt following the...

A Policeman in action against stone pelters during violent clashes which erupt following the...

Delhi Deputy Chief Minister Manish Sisodia addressing a press conference in New Delhi...

Delhi Deputy Chief Minister Manish Sisodia addressing a press conference in New Delhi...

Congress activists took out a rally in Kolkata on Saturday, demanding improvement in law and...

Congress activists took out a rally in Kolkata on Saturday, demanding improvement in law and...

Youth Congress organised Beef Festivals in front of Ernakulam BJP office in Kochi...

Youth Congress organised Beef Festivals in front of Ernakulam BJP office in Kochi...

Spiritual leader the Dalai Lama confer the Avalokiteshvara Empowerment from the Main Tibetan...

Spiritual leader the Dalai Lama confer the Avalokiteshvara Empowerment from the Main Tibetan...

The completely damaged house where two militants including a top commander of Hizbul Mujahideen...

The completely damaged house where two militants including a top commander of Hizbul Mujahideen...

A group of protesters who have blocked the road near the scene of a fierce gunbattle between...

A group of protesters who have blocked the road near the scene of a fierce gunbattle between...

Like us on Facebook

Copyright 2017, The Printers (Mysore) Private Ltd., 75, M.G Road, Post Box 5331, Bengaluru - 560001
Tel: +91 (80) 25880000 Fax No. +91 (80) 25880523
Powered by Yodasoft Technologies Pvt. Ltd.