Covid-driven loan recast to take GNPAs to 11.5% by March: CARE report

The pandemic-induced one-time loan restructuring will spike the system-wide gross non-performing assets (GNPAs) to 11-11.5 per cent by March, says a report.

Care Ratings expects 4-5 per cent of the existing loans to be stressed and opt for restructurings through the course of the year.

The system-wide GNPAs stood at 8.2 per cent in Q1 of FY21, down from 9.5 per cent in Q1 FY20, thanks to the recoveries and higher write-offs during the period.

The ratings agency expects fresh additions to the dud assets pile to primarily come from loans under SMA 1 and SMA 2 categories which were