Second wave: Too early to take call on asset quality dip, says SBI chief

Despite limited lockdowns this time, economic impact will be felt, household income takes a hit

State Bank of India has said the new financial year (FY22) has begun with an unexpected second wave of Covid-19 infections, accompanied by low aggregate demand and impairment of household income.

Although the containment strategy this time included avoiding complete lockdown and managing the situation through micro-containment zones, the impact on the economy will nevertheless be felt.

"It is too early to take a call of a possible deterioration of asset quality in banks due to the second wave," said Dinesh Khara, its chairman in a communication to shareholders. The annual general Meeting of shareholders is slated on June 25,