NPAs of listed banks jump 35% to over Rs2,43,000 cr: Study

Gross non-performing assets (NPAs) of 40 listed banks in the country shot up by Rs63,386 crore (or 35.2 per cent) to over Rs2,43,000 crore in the nine months ended 31 December 2013, according to a recent study.

NPAs of listed banks jump 35% to over Rs2,43,000 cr: StudyNPAs of banks showed a worsening trend as the financial year progressed – increasing from 27 per cent in the first six months of the financial year (April-September 2013-14) to 35.2 per cent for the nine-month period ended 31 December 2013, according to a study by NPAsource.com, a portal focused on resolution of stressed assets.

Ten out of the 40 listed banks accounted for nearly 70 per cent of the gross NPAs.

State Bank of India with Rs67,799 crore or 28 per cent of total gross NPAs has the largest share in gross NPAs of the 40 listed banks, followed by Punjab National Bank with Rs16,596 crore (7 per cent) and Bank of Baroda and Central Bank of India with 5 per cent share each.

Bank of Maharashtra saw its NPAs increase by a whopping 209 per cent to Rs3,516 crore from Rs1,138 crore as of 31 March 2013. United Bank reported a 188 per cent jump in gross NPAs at Rs8,546 crore at the end of Q3.

Eleven banks posted over 50 per cent growth in their gross NPAs, Devendra Jain, chairman and managing director, Atishya Group, the owner of portal NPAsource.com, said on Tuesday.

''There is no respite for banks in India from the onslaught of higher interest rates and slowdown in the Indian economy leading to further increase in loans turning bad from corporate as well as retail segments. The fourth quarter of 2013-14 will continue to be bad for banks on the NPAs front, but most banks will resort to higher levels of provisioning so as to bring down their net NPA levels.''

Banks will continue to nurse a huge pile of NPAs in the first quarter of next financial year, as well, he said, adding that 100 major corporates account for most of bank NPAs.

Net NPAs of banks during the first nine months of the current financial year rose to 49 per cent from 38 per cent during the first six months of fiscal 2013-14.

Net NPAs of the 40 listed banks have rose to Rs1,38,000 crore as of end-December 2013, from Rs93,116 crore at the end of March 2013.

Banks are expected to see a further erosion in their assets after the interim budget announced a moratorium in repayment of education loans, which is expected to benefit about 9 lakh student borrowers.

The moratorium that will offer relief to the tune of Rs2,600 crore to borrowers, is sure to add to banks' NPAs.

Presenting the interim budget in the Lok Sabha on Monday, finance minister Chidambaram, however, offered to compensate banks by providing a sum of Rs2,600 crore in the current financial year itself. This amount, he said, will be transferred to the Canara Bank.

At the end of December 2013, public sector banks had 25,70,254 student loan accounts and the amount outstanding was Rs57,700 crore.

Chidambaram also proposed to allocate an amount of Rs11,200 crore towards capital infusion in public sector banks in the interim budget 2014-15.