Monday 9 January 2017

NPA pains to spill over into next fiscal, says Moody's

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Weak asset quality will continue to plague credit profile of banks, with their profitability remaining under pressure till the next fiscal. Asset quality will remain a negative driver of the credit profiles of most rated banks in the country and the stock of impaired loans. Non-performing loans and standard restructured loans will still rise during the horizon of our outlook that lasts till the next financial year," Alka Anbarasu, a vice-president and senior analyst at Moody's, said in a report today. 

The report is jointly penned by Moody's and its domestic arm Icra Ratings. The report said the pressure on asset quality largely reflects the system's legacy problems, as relating to the strong credit growth seen in 2009-12, when corporate investments rose significantly.

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