RBI stress test shows banks' asset quality might improve in 2019

PSBs' GNPA ratio may decline to 14.6 per cent by March 2019 under baseline scenario, whereas private banks' GNPA ratio may decline from 3.8 per cent to 3.3 per cent in March 2019

The quality of assets in the banking sector may improve in 2019, show stress tests conducted by the Reserve Bank of India (RBI).

Under the baseline scenario, the gross non-performing assets ratio (GNPA) ratio of all banks may come down from 10.8 per cent in September 2018 to 10.3 per cent by March 2019. This could further fall to 10.2 per cent in September, said the RBI’s Financial Stability Report, released on Monday. 

“After a prolonged period of stress, the banking sector appears to be on course to recovery as the load of impaired assets recedes; the first half-yearly decline