Deadline ends for NPAs: Provisioning for NCLT-3 accounts seen at Rs 1 trn

Higher provisioning will also raise capital requirement of banks; bankers differ on the extent of impact

As the deadline for stressed asset resolution, as per the Reserve Bank of India’s (RBI’s) February 12 circular, concluded on Monday, lenders are expected to file insolvency petitions against around 60 stressed corporates.

Insolvency applications with respective National Company Law Tribunals (NCLTs) will be filed by the banks over the next two-three weeks, increasing the provisioning requirements against these accounts for all banks by Rs 0.8 trillion to Rs 1 trillion, rating agency ICRA has estimated.

The extent of additional provisioning, however, may vary from case to case given the age of the stressed assets, as well as the requirement