Banking sector NPAs rose to 1.3% in FY12 from 0.97%
MDT/PTI 03 October 2012

NPAs or bad loans of public sector banks rose to 1.53% from 1.09%, however private banks reduced their NPAs to 0.46% from 0.56% during 2011-12

Mumbai: Non-performing assets (NPAs) of the banking sector rose sharply to 1.28% in 2011-12 from 0.97% a year ago due to high interest rate and slowdown in the economy, reports PTI.


The NPAs or bad loans of the public sector banks rose to 1.53% in 2011-12, up from 1.09% in the previous year, said the latest RBI report.


As per the Profile of Banks: 2011-12 released by the RBI, the NPA for India's largest public sector lender SBI along with its associates rose to 1.76% from 1.49% in 2010-11.


SBI's net NPA rose to 2.22% in the first quarter of the current fiscal from 1.61% a year earlier.


However, private sector banks managed to reduce their NPAs in 2011-12 to 0.46% from 0.56% in 2010-11, it said.


Non-performing assets of old private sector banks increased marginally to 0.58% during the year from 0.53% in the previous fiscal.


Also, foreign sector banks had their NPAs below one% at 0.61%, down from 0.67% in 2010-11, RBI said.


RBI, however, has asked the banks to improve their ability to manage stressed assets.


Banks, specifically public sector, have been reporting higher NPAs in their books because of continued slowdown in the economic activities on the back of rising interest rate regime.

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