India's financial system remains stable even after economic growth plummeted to a six-year low, the Reserve Bank of India (RBI) said on Friday.
Lenders are struggling as credit demand has remained subdued due to overall sluggishness in the economy. Even though the share of bad loans in the banking sector has declined, further improvement by banks is required, added the RBI.
State-owned public sector banks need to build stronger buffers to absorb any disproportionate
The country's shadow banking sector has been struggling since last year after the collapse of IL&FS, a major infrastructure lender. This has also impacted banks.
"Failure of any Non-
PMC used more than 21,000 fictitious accounts to hide loans it made to one realty company which had led to a loss of at least 43.55 billion Indian rupees ($610 million).
Even now loan-related frauds continue to dominate by constituting 90% of all frauds reported in the financial year 2018-19 by value, said the RBI.