Monday, December 29, 2014

The Financial Stability Report of the RBI ... Some Extracts...

"However, contagion analysis with top five most connected banks reveals that the banking system could potentially lose significant portion of its total Tier-I capital under the joint solvency-liquidity condition in the event of a particular bank triggering a contagion."

"Another aspect that impinges upon the banks’ asset quality is corporate leverage and its impact on banks’ balance sheets, particularly ‘double leveraging’ through holding company structures and the pledging of shares by promoters."

"The gross non-performing advances (GNPAs) of SCBs as a percentage of the total gross advances increased to 4.5 per cent in September 2014 from 4.1 per cent in March 2014. The net non-performing advances (NNPAs) as a percentage of total net advances also increased to 2.5 per cent in September 2014 from 2.2 per cent in March 2014. Stressed advances increased to 10.7 per cent of the total advances from 10.0 per cent between March and September 2014. PSBs continued to record the highest level of stressed advances at 12.9 per cent of their total advances in September 2014 followed by private sector banks at 4.4 per cent. "


"Real Estate Share in Total advances is 17.4 % "...

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