LIVE MARKET TRACKER :   BSE SENSEX        |    NSE NIFTY    
GLOBAL MARKETS :  NASDAQ      |    FSI London      |    NIKKEI Japan  
  USD GBP EUR CAD AUD INR
USD -
GBP -
EUR -
CAD -
AUD -
INR -
Indian-Commodity  :  Economy  :  Banks may need Rs 3.3 lakh crore as provisioning for NPA accounts in FY18: CRISIL

Banks may need Rs 3.3 lakh crore as provisioning for NPA accounts in FY18: CRISIL (13-Oct-2017)

The rating agency, CRISIL in its latest report has said that Indian banks may need to set aside as much as Rs 3.3 lakh crore as provisioning, mainly for large corporate non-performing assets (NPAs) in the financial year 2018. It observed that the economic value of assets underlying NPAs is eroding with time, and resolutions are hard to come by, therefore, banks would need to do well to bite the bullet and step up on provisioning. It also believes that this will facilitate faster clean-up of their balance sheets.

The rating agency has said that it arrived at the Rs 3.3-lakh-crore number after an account-by-account analysis of the economic value of assets underlying large corporate bad loans. It also showed that potential write-downs could be in the 25% to 75% range. Further, it pointed out that while some of the NPA accounts have been adequately provided for, the majority of them will require higher provisioning compared with current levels, based on the residual economic value of the assets. The report also estimated that this could lead to a net loss of nearly Rs 60,000 crore for the banking sector this fiscal with public sector banks (PSBs) bearing the brunt of the increase in provisions and the resultant impact on profitability because of their higher stock of NPAs.

Adding further, the report has noted that operating profits of banks, calculated before making loan and tax provisions, is likely to stabilise by the end of this fiscal, largely due to improvement in the net interest income. It also expects that pressure on the earnings profiles of banks would reduce from next fiscal if banks increase provisioning on large corporate NPAs this fiscal. It added that stabilization in operating profitability and mitigation of asset quality stress would then set the stage for earnings revival, especially of PSBs, as they focus more on credit growth.


Top News Today
Future Enterprises gets nod to raise funds up to Rs 1,500 crore
(26-May-2018)

Future Enterprises gets nod to raise funds up to Rs 1,500 croreFuture Enterprises has received its board's approval to raise funds by issue of Secured Redeemable Non-Convertible Debentures (NCDs) for a value up to Rs 1,500 crore in one or more tranches within a period......click on news to read complete article.

IFCI recovers Rs 280 crore from Bhushan Steel
(26-May-2018)

IFCI recovers Rs 280 crore from Bhushan SteelIFCI has recovered Rs 280 crore from debt-ridden Bhushan Steel under the insolvency process. The company also received over 5.79 lakh equity shares of Bhushan Steel, having face value of Rs 2 per share.IFCI......click on news to read complete article.

Sun Pharma reports 7% rise in Q4 consolidated net profit
(26-May-2018)

Sun Pharma reports 7% rise in Q4 consolidated net profitSun Pharmaceutical Industries has reported results for the fourth quarter and year ended March 31, 2018.The company has reported a rise of 83.30% in its net profit at Rs 176.26 crore for the quarter ended......click on news to read complete article.

International Stock News
US markets end mostly in red on Friday
(26-May-2018)

US markets end mostly in red on FridayThe US markets ended the choppy day of trade mostly in red terrain as some traders were away from their desks, looking to get a head start on the long Memorial Day weekend. Geopolitical uncertainty also......click on news to read complete article.

US markets end mostly in red on Friday
(26-May-2018)

US markets end mostly in red on FridayThe US markets ended the choppy day of trade mostly in red terrain as some traders were away from their desks, looking to get a head start on the long Memorial Day weekend. Geopolitical uncertainty also......click on news to read complete article.

US markets end lower on Thursday
(25-May-2018)

US markets end lower on ThursdayThe US markets ended in red terrain on Thursday, as geopolitical worries hovered over markets after Trump called off the summit that was set to take place June 12 in Singapore. The cancellation followed......click on news to read complete article.

 

     
  
Recent Economy News
 
EquityInvestmentCompany ReportsIPO
Disclaimer
By clicking on this page you accept all the terms and conditions framed by us. News made available here are for informational purpose only. While utmost care has been taken in providing the same. We claim no responsibility for its accuracy. Readers of this blog who make their decision based on the information posted here are solely responsible for their actions.