SCBs well capitalised, capable of absorbing macroeconomic shocks: RBI

The Reserve Bank of India’s stress test results reveal that scheduled commercial banks (SCBs) are well-capitalised and capable of absorbing macroeconomic shocks even in the absence of any further capital infusion by stakeholders. It shows no SCB would breach the minimum capital requirement of 9 per cent in the next one year.

All banks would be able to meet the minimum regulatory common equity tier 1 (CET1) ratio of 5.5 per cent even under severe stress scenario.

Gross NPA to worsen sharply only under severe stress scenario while the baseline projections suggest the asset quality to improve in the next one year.