Davos, Jan 23 (PTI) As the Indian economy gathers momentum, it will reflect in banks' asset quality while the issue of over-leveraging by corporates is also expected to get corrected going ahead, top banker Chanda Kochhar said.
"Banks have restructured a number of loans in the current economic cycle and banks will have to closely monitor the performance of their restructured loans," ICICI Bank's CEO and MD said.
"As the recovery in the growth of the Indian economy strengthens, it will start reflecting in banking asset quality with a lag," Kochhar told PTI in an interview.
Kochhar, who is here to attend the WEF Annual Meeting, was responding to a query on the problems of bad loans in the Indian banking sector.
On a question of RBI having warned about over-leveraging and huge share pledging of shares by promoters of the companies, Kochhar said, "It is true that leverage in some companies and sectors is high.
"But this has to be seen in the context of large investments made by these companies; weak equity markets prior to the current year; slowdown in growth; high interest rates; and delays in project completion.