Credit rating agency Crisil has said the gross non-performing assets in the banking system could touch 11.5% in this financial year. The figure stood at 11.2% in FY2018, when GNPAs increased to around Rs 10.3 lakh crore compared with Rs 8 lakh crore, or 9.5% of advances as on 31 March 2017. Crisil said in a statement it expected the GNPAs to touch 11.5% and then start reducing. In FY2018, the banking system reported a net loss of Rs 40,000 crore because of the sharp rise in NPAs and the resulting increase in provisioning costs. In the previous fiscal, as much as Rs 5 lakh crore of bank loans slipped into the non-performing assets (NPAs) category, taking the total slippages in the past three fiscals to Rs 13.6 lakh crore. About a fifth of the slippages in FY18 was due to withdrawal of various structuring schemes by the Reserve Bank in February, after the Insolvency and Bankruptcy Code (IBC) process came into force, the report said. It added that the GNPAs may come down in view of moderation in slippages, better recoveries from NPAs and improved provision coverage by banks.
