Indian banks' profitability weaker than BRICS peers, says Moody's report

Chinese banks had the lowest problem loan ratio of 1.5 per cent at the end of 2017, while Russian banks had the highest at 11.8 per cent, closely followed by those in India. 

In profitability, Indian banks are also distinctively weak. Moody’s says the system, as a whole, is unprofitable due to high credit costs at dominant state-owned banks. 

By contrast, Brazilian and South African banks have the highest return on assets.

In capitalisation, South African banks are the strongest with tangible common equity amounting to 12.4 per cent of risk-weighted assets (RWA), while Indian banks had the least tangible common equity ratio of 8.7 per cent.

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Figures in %(for 2017); PPI is pre-provisioning income, RWA is risk-weighted assets Source: Moody’s Investors Service