War on NPAs will go on, says new SBI chief

Public sector lender State Bank of India (SBI) on Tuesday reitereated that its top priority will be to contain non-performing assets (NPAs) and rationalise  management of such assets. 

Addressing her first press conference after being appointed as the first woman chief in the 207-year-old bank, Chairperson Arundhuti Bhattacharya said: “We can’t say that the war on NPAs is over. It will continue till the time NPA stress is reduced on our books.”

"In fact, we are going to increase the intensity (of containing NPAs), Bhattacharya said, adding that the bank is looking to rationalise NPA management.  She explained, "We will look to cut down the time span for resolving the processes.”

Further, she said SBI will be increasingly using IT solutions to resolve the NPA crisis. “(I am) not worried about ROAs (return on assets) and ROEs (return on equities), it will improve with NPA containment,” she said.

The new SBI chief affirmed that home loan rates were not going to be reduced going forward. The bank is also comfortable with lending to customers for purchasing automobiles, which will in turn boost auto sales. The retail segment is performing well and lending to corporates will be done selectively, she added.

She was not very upbeat over the bank's forthcoming quarterly performance, as it will not show recovery given the economy continues to remain stressed.

Bhattacharya said that although the merger process with other banks will begin this year, it won’t be over as the government has to take a call on capital flows. 

On the impact of MSF (marginal standing facility) rate cut, she said: "There is no question of loan rates coming down."