For Quick Alerts
For Daily Alerts

Stress assets of domestic banks to peak at around 15%: Fitch

By Religare

A Fitch report said that the asset quality indicators for the domestic banks continue to deteriorate, and stressed assets are likely to peak around 15 per cent due to further weakening of the economic environment.

"The asset quality indicators for Indian banks continue to deteriorate and will likely reach levels much worse than previously expected due to further weakening in the economic environment," it said.

"We expect the proportion of stressed assets to peak at around 15 per cent."Stressed assets of domestic banks were at 9.1 per cent of total loans (which includes non-performing loans of 3.4 per cent and restructured loan ratio of 5.7 per cent) in FY'13 from 6.1 per cent in FY'12, said PTI report.


Meanwhile, Fitch said that the private sector banks have superior credit profile supported by their robust earnings profile, lower stressed assets and strong capital position.

As per the report, state-owned banks may not seek funding through equity market route in the near to medium-term due to their weak performance, adding to the dependence on the government for capital infusion.

It, however, said, "Funding for Indian banks is generally satisfactory though liquidity is expected to remain tight in the near-term."

Dion Global Solutions Ltd.

Company Search
Get Instant News Updates
Notification Settings X
Time Settings
Clear Notification X
Do you want to clear all the notifications from your inbox?
Settings X
We use cookies to ensure that we give you the best experience on our website. This includes cookies from third party social media websites and ad networks. Such third party cookies may track your use on Goodreturns sites for better rendering. Our partners use cookies to ensure we show you advertising that is relevant to you. If you continue without changing your settings, we'll assume that you are happy to receive all cookies on Goodreturns website. However, you can change your cookie settings at any time. Learn more