Bad loans spark bank downgrades
MUMBAI: Distressed borrowers are taking a toll on the credit profiles of Indian banks with almost half a dozen lenders being downgraded by rating agencies in recent weeks. Given that most public sector banks have similar credit profiles, analysts tracking the banking sector are asking, "Who's next?"
Explaining UCO Bank's downgrade, ICRA said that the bank's gross NPAs rose from 2.57% to 3.49% as of December, 2011. It also cited the high level of restructured advances at around 6% of loans and relatively high exposure to weak sectors like state electricity boards, distribution companies and aviation sector. Similarly, in the case of Oriental Bank of Commerce, the level of gross NPAs had risen from 1.95% to 2.92% with restructured loans touching 4.84%. In the case of Central Bank, restructured loans were at a high of 7.4% of advances as of December, 2011 with gross NPAs touching 3.69%.
Read details at - http://timesofindia.indiatimes.com/business/india-business/Bad-loans-spark-bank-downgrades/articleshow/12565322.cms
Regards,
Praveen Kumar
Explaining UCO Bank's downgrade, ICRA said that the bank's gross NPAs rose from 2.57% to 3.49% as of December, 2011. It also cited the high level of restructured advances at around 6% of loans and relatively high exposure to weak sectors like state electricity boards, distribution companies and aviation sector. Similarly, in the case of Oriental Bank of Commerce, the level of gross NPAs had risen from 1.95% to 2.92% with restructured loans touching 4.84%. In the case of Central Bank, restructured loans were at a high of 7.4% of advances as of December, 2011 with gross NPAs touching 3.69%.
Read details at - http://timesofindia.indiatimes.com/business/india-business/Bad-loans-spark-bank-downgrades/articleshow/12565322.cms
Regards,
Praveen Kumar
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