Dangerous misuse of mandate by BJP: Sonia Gandhi

Munbai/New Delhi, May 4: India expects bad debts at its banks could double after the coronavirus crisis brought the economy to a sudden halt, a senior government official and four top bankers said.

Indian banks are already grappling with 9.35 trillion rupees ($123 billion) of soured loans, which was equivalent to about 9.1% of their total assets at the end of September 2019.

"There is a considered view in the government that bank non-performing assets (NPAs) could double to 18-20% by the end of the fiscal year, as 20-25% of outstanding loans face a risk of default," the official with direct knowledge of the matter said.

A fresh surge in bad debt could hit credit growth and delay India's recovery from the coronavirus pandemic.

"These are unprecedented times and the way it's going we can expect banks to report double the amount of NPAs from what we've seen in earlier quarters," the finance head of a top public sector bank told Reuters.

The official and bankers declined to be named as they were not officially authorized to discuss the matter with media.

India's finance ministry declined to comment, while the Reserve Bank of India and Indian Banks' Association, the main industry body, did not immediately respond to emails seeking comment.

The Indian economy has ground to a standstill amid a 40-day nationwide lockdown to rein in the spread of coronavirus cases.

The lockdown has now been extended by a further two weeks, but the government has begun to ease some restrictions in districts that are relatively unscathed by the virus.

India has so far recorded nearly 40,000 cases of the coronavirus and more than 1,300 deaths from COVID-19, the respiratory disease caused by the coronavirus.

'RIDING THE TIGER'

Bankers fear it is unlikely that the economy will fully open up before June or July, and loans, especially those to small- and medium-sized businesses which constitute nearly 20% of overall credit, may be among the worst affected.

This is because all 10 of India's largest cities fall in high-risk red zones, where restrictions will remain stringent.

A report by Axis Bank said that these red zones, which contribute significantly to India's economy, account for roughly 83% of the overall loans made by its banks as of December.

One of the sources, an executive director of a public sector bank, said that economic growth had been sluggish and risks had been heightened, even ahead of the coronavirus crisis.

"Now we have this Black Swan event which means without any meaningful government stimulus, the economy will be in tatters for several more quarters," he said.

McKinsey & Co last month forecast India's economy could contract by around 20% in the three months through June, if the lockdown was extended to mid-May, and growth in the fiscal year was likely to fall 2% to 3%.

Bankers say the only way to stem the steep rise in bad loans is if the RBI significantly relaxes bad asset recognition rules.

Banks have asked the central bank to allow all loans to be categorized as NPAs only after 180 days, which is double the current 90-day window.

"The lockdown is like riding the tiger, once we get off it we'll be in a difficult position," a senior private sector banker said.

Mumbai, Jan 15: The Reserve Bank of India (RBI) on Wednesday redistributed portfolios of Deputy Governors following the appointment of Michael Debabrata Patra to the post.

An official release said that NS Vishwanathan will handle co-ordination, Department of Regulation (DOR), Department of Communication (DoC), Enforcement Department, Inspection Department (ID), Risk Monitoring Department (RMD), and Secretary's Department.

BP Kanungo will look after Department of Currency Management (DCM), Department of External Investments and Operations (DEIO), Department of Government and Bank Accounts (DGBA), Department of Information Technology (DIT), Department of Payment and Settlement Systems (DPSS), Deposit Insurance and Credit Guarantee Corporation (DICGC), Foreign Exchange Department (FED), Internal Debt Management Department (IDMD), Legal Department (LD) and Right to Information (RIA) Division.

The release said that MK Jain will handle the Department of Supervision (DOS), Consumer Education and Protection Department (CEPD), Financial Inclusion and Development Department (FIDD), Human Resource Management Department (HRMD), HR Operations Unit (HR-OU), Premises Department (PD), Central Security Cell (CSC), and Rajbhasha Department.

Patra will look after the Monetary Policy Department including Forecasting and Modelling Unit (MPD/MU), Financial Markets Operations Department (FMOD), Financial Markets Regulation Department including Market Intelligence (FMRD/MI), International Department (Intl. D), Department of Economic and Policy Research (DEPR), Department of Statistics & Information Management (including Data and Information Management Unit) (DSIM/DIMU), Corporate Strategy and Budget Department (CSBD) and Financial Stability Unit.

New Delhi, Jun 8: Delhi Chief Minister Arvind Kejriwal has gone into self-quarantine after developing sore throat and fever, and will get himself tested for COVID-19 on Tuesday, officials said on Monday.

They said the chief minister, who is also a diabetic, was feeling unwell since Sunday afternoon.

"He has mild fever and sore throat since Sunday afternoon. As advised by doctors, the chief minister will undergo COVID-19 test on Tuesday morning," officials said.

Officials said the CM had attended a Cabinet meeting on Sunday morning and thereafter, he did not attend any meeting.

The chief minister has been holding most of his meetings via video conferencing from his official residence for past two days.

This come as the number of coronavirus cases in the national capital crossed the 28,000-mark with 1,282 fresh infections while the death toll climbed to 812 on Sunday, a health bulletin issued by the Delhi government said. According to the health bulletin, the total number of COVID-19 cases in Delhi rose to 28,936 with 1,282 fresh cases.

A total of 51 fatalities were reported on June 6, the bulletin said, adding that these lives were lost between May 8 and June 5. It, however, said the cumulative death figure refers to fatalities where the primary cause of death was found to be COVID-19, according to a report of the Death Audit Committee on the basis of the case-sheets received from various hospitals.