Gross NPAs Could Rise To 9.8% Of Total Assets By March 2022: RBI

RBI Financial Stability Report July 2021: Banks' gross non-performing assets could rise to 9.8 per cent of total assets by March 2022 from around 7.48 per cent as of the end of March this year

Banks have strong enough capital and liquidity buffers to withstand future shocks as the impact of the pandemic on their balance sheets has not been as severe as projected earlier, a report from the Reserve Bank of India (RBI) said. The Financial Stability Report is published bi-annually by the RBI on behalf of the Financial Stability and Development Council, an umbrella group of regulators which gives an overview of the health of India's financial system. The report said banks' gross non-performing assets could rise to 9.8 per cent of total assets by March 2022 from around 7.48 per cent as of the end of March this year under a baseline scenario and to 11.22 per cent under a severe stress scenario. The projections are much less pessimistic than the report released in January, in which the RBI had said that bad loans could double in a severely stressed scenario.