India has surpassed Italy for having the worst non-performing loans ratio among the major economies in the world. According to a Bloomberg report, the Reserve Bank of India (RBI) in December said that the ratio for banks have fallen for the first time since 2015 but still remains in "high for comfort."
A pile of soured and stressed debt worth $190 billion has cast the future of some lenders in doubt and curbed investments.
The IMF (International Monetary Fund) Financial Sound Indicators showed that the bad loan ratios of the top 10 economies being (from the highest to lowest)
- India: 10.3 percent
- Italy: 9.9 percent
- Brazil: 3.2 percent
- France: 2.9 percent
- China: 1.9 percent
- Germany: 1.5 percent
- UK: 1.2 percent
- Japan: 1.1 percent
- USA: 0.9 percent
- Canada: 0.4 percent
It is to be noted that the ratio was computed based on the data for China, India, Brazil, Germany and US as of September 2018, Italy, France, and Canada as of June 2018 and that of the UK and Japan as on March 2018.
Italy managed to reduce its bad loan ratio quickly by reducing its non-performing loans to about 200 billion euros ($227 billion) in the last year from a peak of over 360 million euros in 2016.