
Post-merger, clean-up ops underway at PNB
The merger and asset quality overhang may have kept its growth tepid, but it posted a higher-than-expected net profit of ₹506 crore in the third quarter.
The merger and asset quality overhang may have kept its growth tepid, but it posted a higher-than-expected net profit of ₹506 crore in the third quarter.
While Indian banks' improved financial metrics do not fully reflect the impact of the Covid-19 pandemic, the under–capitalised PSBs are likely to remain risk averse and lose market share.
At its first monetary policy review for 2021, the central bank kept key rates unchanged, while announcing several measures to manage liquidity.
Apart from recapitalisation, public sector banks get a shot in the arm in the form of ARC and AMC mechanisms to clean up their books.
There is a need to make the insolvency system more robust, and the revival mechanism swifter and more efficient. The Budget 2021 may provide a way forward.
According to the RBI, the gross NPA ratio of all scheduled commercial banks may increase from 7.5% in September 2020 to 13.5% by September 2021, and even escalate to 14.8% in severe stress scenario.
With Lakshmi Vilas Bank in its fold, the foreign bank’s branch count jumps over 18 times. But the merger could also open up a potential Pandora's box.
The extension, which takes the total day-count of the lockdown to 54, will add to the challenges that the economy was already facing before Covid-19 took the shape of a pandemic.
FM Nirmala Sitharaman will hold similar meetings with representatives from MSMEs, auto, industry associations, financial market stakeholders, and others to address sector-specific issues.
A report by CRISIL says an uptick in credit demand in FY19-FY20 will require banks to raise funds through fresh deposits.