With energy stocks on a retreat, the contagion impact on banks which have lent to energy entities will be under pressure. They would have to call for enhanced margins or treat the credit granted as NPAs as payment is unlikely from cash flows. The quantum may be huge, given that this was an expanding industry. Allied businesses like natural gas and distribution agencies may also feel the pressure. We may have to wait for some time for any good news. Banks in the Middle East will see wholesale business slowdown.
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