The Reserve Bank on Monday eased norms for structuring of existing long-term project loans to infrastructure and core industries, to revive stalled plans and help banks tide over mounting bad loans.
Dream hillstation project Lavasa, near Pune, is now a millstone around lenders' neck.
The finance minister asked lenders to identify eligible borrowers and reach out to them and urged for quick implementation of a sustained resolution plan for the revival of every viable business.
'We first need to acknowledge the truth.' 'We are trying to diminish the problem and say, everything is okay and green shoots are emerging.' 'Imagine you are a doctor and not getting accurate medical reports, how do you diagnose and treat the illness?' 'We are not dealing with a terminal illness here, we are dealing with BP and cholesterol, which are imminently curable.'
If warranted they can initiate criminal proceedings including filing of FIR, a Finance Ministry official said.
Non-performing assets of banks have increased from Rs 2.75 lakh crore in March 2015 to Rs 7.33 lakh crore as on June 2017.
'Today, bankers don't want to take risks as the good decisions taken by them were not protected.' 'There is risk involved in all decisions, like businessmen taking risks in their businesses.' 'A banker must have taken a decision when the economic condition was different, and you cannot question him on the basis of the present situation in hindsight.' 'Naturally, this has affected the morale of bankers.'
However, the road to profitability has already hit some hurdles for the Delhi-based bank as the Union government has rejected its demand for an additional capital infusion of around Rs 8,000 crore in 2018-19
'What do the moves towards protectionism suggest?' 'That we do not have Aatmavishwas.' 'If you have self-confidence, confidence in your ability to compete with the best in the world, why do you need protectionism?'
To ease pressure due to the coronavirus lockdown, corporate have asked banks and the government for a six-month liquidity line, so that they can pay off their suppliers and employees.
Given the developments, analysts expect fiscal and monetary support from the government and RBI to revive sentiment. However, recovery, they say, from these levels will be slow and painful.
Banks recovered Rs 18,933 crore (Rs 189.33 billion) worth of bad loans during the April-December period.
The RBI working group's proposal to allow corporate houses to set up banks is a "bombshell" and at this juncture, it is more important to stick to the tried and tested limits on involvement of business houses in the banking sector, according to an article jointly written by former RBI Governor Raghuram Rajan and ex-Deputy Governor Viral Acharya. They also said that the proposal is "best left on the shelf".
Former RBI governor R Gandhi said that the RBI needs to re-introduce a one-time restructuring package and mere moratoriums will not suffice in unprecedented times like the COVID-19 pandemic.
Not all public sector banks are back in the black, but their collective net profit for the year is Rs 32,346 crore against a Rs 9,013 crore loss in the previous year, points out Tamal Bandyopadhyay.
'Fear psychosis has gripped the entire world.' 'Nobody is going to enter shops freely in the next 5, 6 months.' 'Secondly, the priority has changed.' 'Now that they have seen the bottom of the economy, people will prefer to save for tomorrow.'
The Congress president alleged that the surgical strike was made public as the BJP was fighting elections in Uttar Pradesh.
NPA percentage in loans may touch 10% by March 2013, up from 5% in March 2011.
Move comes after the country's monetary authority tightened credit norms
Market participants are hoping for a few tweaks on the taxation front which will encourage consumers and businesses to spend.
Corporation Bank is the biggest beneficiary of this round of capital infusion with Rs 9,086 crore of funding, followed by Allahabad Bank with Rs 6,896 crore.
Sector-wise, the study revealed that the core industries have witnessed virtually negative growth in headcount, with crude oil just about maintaining the employment level.
'Election years tend to see high government expenditure on unproductive schemes, though that money sloshing around can boost private consumption.' 'Again, it can mean higher inflation,' explains Devangshu Datta.
Its total income during the September quarter also slipped to Rs 30,191 crore, as against Rs 32,435 crore in the year-ago period
Rather than focusing on profits, market should look at the inherent strength of the balance sheet whether it can withstand difficulties, he said.
Seeking ArcelorMittal be declared ineligible to bid for Essar Steel, the petition cited Section 29A of the Insolvency and Bankruptcy Code which bars promoters of defaulting companies from bidding for stressed assets.
'The variables to watch include the monsoon, resolution of NBFC liquidity issues, GST collections, and NPA resolution.'
Kapoor, 62, and the Wadhawans were arrested by the agency in this case early this year and they are in judicial custody at present.
'Our government has created 10 million jobs when the Indian unemployment rate is at a 45-year high.'
In the broader market, the S&P BSE Midcap and the S&P BSE Smallcap indices gained 0.5% and 0.4%, respectively.
With 600-700 new NPA cases getting admitted into NCLT every month, the demand for resolution professionals is on the rise with their number more than doubling in less than a year.
Heads of various public and private sector banks on Thursday sought to present a counter-narrative on RBI Governor Shaktikanta Das warning lenders about the perils of extreme risk aversion in the pandemic-stricken environment where credit demand is on the wane.
The Reserve Bank of India (RBI) has just allowed banks to go a bit easy on provisioning norms for non-performing assets (NPA) in response to their urgent supplications.
The country's largest lender SBI on Thursday reported a 4.20 per cent decline in consolidated December quarter net at Rs 6,257.55 crore, largely because of a higher base in the year-ago period where it had benefitted from a Rs 4,500 crore one-off income. On a standalone basis, the city-headquartered lender's net profit came in at Rs 5,196.22 crore as against Rs 5,583.36 crore in the year-ago period and Rs 4,574.16 crore in the preceding September quarter. SBI chairman Dinesh Kumar Khara told reporters that the year-ago period had seen the resolution of the Essar Steel loans, resulting in an over Rs 4,000 crore interest income and Rs 500 crore other income benefit.
Top gainers in the Sensex pack were TCS, Bharti Airtel, Infosys, Axis Bank, L&T, ITC, PowerGrid, HCL Tech and Tata Steel, ending up to 2.39 per cent.
The sobering news is that retailers - including big firms like Reliance Retail - and exhibitors are contemplating issuing force majeure notices to shopping malls and real estate owners, and are in discussions with them to formulate an action plan for sharing the financial burden of the lockdown.
... if high oil prices persist or stock prices correct sharply.
Das said banks have passed only 0.29 per cent in rate cuts to their borrowers as against 0.75 per cent cuts in interest rates by the Reserve Bank till June.
'As long as the government owns the banks, bankers will follow signals from politicians as to how to lend.' 'State-owned banks will remain State-owned banks as long as the current dispensation is in power -- and certainly there will be no change if the other chaps get in,' says Mihir S Sharma.
Gandhi accusing the minister of 'lying' on HAL's capability to build the jet fighters, saying her position is untenable.
