Asset quality of banks remained stable during pandemic year: RBI FSR

With debt recast at only 0.9% of total loans, banks fare much better than RBI's doomsday projection on bad loans

Banks did not see their bad loan position worsening during the pandemic year of 2020-21 as the gross non-performing ratio stayed stable at 7.48% of the gross advances at the end of March 31, the Financial Stability Report of Reserve Bank of India showed on Thursday.

The stress test conducted by the banking regulator, however, indicated an increase from the March 2021 levels due to the second Covid wave.

The stress tests indicate that the GNPA ratio of commercial banks will increase to 9.8 per cent in the baseline scenario by March 2022 and could increase to 10.36 per cent