Was RBI window dressing on corporate debt restructuring?

 1. Stressed assets - which include both bad loans officially classified as  NPAs  and those under  CDR - reportedly account for   nearly 11 per cent of total bank advances.   Some of the mid sized public sector banks  seem to be severely afflicted. Since late 1980s, RBI has been talking of  tackling NPAs to little effect.  Stressed assets seem to compete with capital adequacy ratios of banks!!!

2. As at the end of September, 7,265   wilful defaulters owed over Rs 64,300 crore to public sector  banks and 115 cases had  bank officials  conniving with the borrowers, according to the government data .

3. Special Mention 1   (31-60 day due and  SMA 2 (60 to 90 days loan servicing delay)  are reportedly a cause for concern as that could result in high NPA slippage ratio.

4. Presently, the total amount of NPAs   of Indian banks is estimated at Rs 3 lakh crores. Total loans under the corporate debt restructuring (CDR) is estimated at around that figure! The total figures might be too much for the system to bear a burden.    

5. Given the heavy lending into infrastructure /power sectors, Indian banks may be walking in to severe winter of NPA season. 

No wonder why the Supreme Court has upheld the need for transparency in banking.The RBI seems to be shielding from the taxpayer in the name of secrecy.

Table for comprehending Indian lakhs / crores to million/ billion

1 Lakh		100,000.00	100 Thousands
10 Lakhs		1,000,000.00	1 Million
1 Crore		10,000,000.00	10 Million
10 Crores		100,000,000.00	100 Million
100 Crores		1,000,000,000.00	1 Billion

Tail piece: There are 3507 pending corporate litigations ; 1400 over a decade; 586 0ver 20 years in India. Ease of doing business. 

This blog recommends no investment or disinvestment. All views expressed are without any risk or responsibility. 

Are Indian banks camouflaging NPA ? D-SIBs - Case Study 8

Below is the NPA and restructured asset position of the 2 domestic systemically important banks : SBI and ICICI Bank
SBI has been transparent identifying the accounts as impaired assets. The SBI proforma should be insisted upon by by SEBI/ RBI as it clearly depicts what an investor needs to know on the actual health of the portfolio.

SBI

Rs. crores	Sep 15	Jun 15	Mar 15	Dec 14	Sep 14
Gross Advances	13,70,701	13,13,735	13,35,424	12,65,483	12,42,63
Gross NPAs	56,834	56,421	56,725	61,991	60,712
Net NPAs	28,592	28,669	27,591	34,469	32,997
Restructured Standard	53,452	55,954	55,843	46,542	43,962
Total Gross NPAs plus Restructured Std.	1,10,286	1,12,375	1,12,568	1,08,533	1,04,674
Gross NPA + Restructured Standard to Gross Adv. %	8.04	8.55	8.43	8.58	8.42
Net NPA + Restructured Standard to Gross Adv. %	5.98	6.44	6.25	6.40	6.19

 SBI: Analyst Presentation. https://www.sbi.co.in/portal/documents/44589/14455961/Analyst+Presentation+Q2FY16.pdf/07cdd09c-4607-420b-90bb-a64e541d0b20

2. ICICI BANK

 as of September 30, 2015  Rs. crores

Advances	409,692.65
Gross non-performing advances (net of write-off)	15,857.82
Net non-performing advances % of gross non-performing advances (net of write-off) to gross advances	6,759.29
%  Gross NPA	3.77%
Net NPA ratio was at	1.65%
Gross NPA additions of	2242
(Slippages of from the standard restructured category to the non-performing asset category including ).	(931)
The net restructured loans for the Bank were Rs. crores	11, 868

Total impaired assets of ICICI may thus be in region of Rs. 27725 crores.  on the basis of above figures. This seems to keep impaired assets at around  6.75 %, even allowing for 'net' restructured assets as given out by ICICI. 

 http://www.icicibank.com/managed-assets/docs/investor/quarterly-financial-results/2016/2015-10-Q2-2016-PR2.pdf

http://www.icicibank.com/managed-assets/docs/investor/quarterly-financial-results/2016/2015-10-Q2-2016-analyst-call-transcript.pdf

100 crores = 1 billion.
$ 1= Rs.66.5 approximately





This blog recommends no investment or divestment. Views expressed here are without any risk or responsibility.

Are Indian banks camouflaging NPA ?Case Study 7

Canara Bank highlight of Q2- 2015-16

Rs Crores

Gross NPA	14021
Gross NPA Ratio (%)	4.27
Net NPA	9383
Net NPA Ratio (%)	2.90
Write Off (Including Addn Prudential Writeoff)	1969
Total Restructured	29026
Std in restructured	22891
NPA in restructured	6135
% of Total Restructured Assets to total Adv	8.83

http://www.canarabank.com/Upload/English/PressReleases/PERFORMANCE_HIGHLIGHTS_SEP_2015.pdf

This blog recommends no investment or divestment. Views expressed here are without any risk or responsibility.

Are Indian banks camouflaging NPA ? Private sector Banks -Case Study 6

Federal Bank Rs. Crores

	30.09.2015	30.06.2015	30.09.2014	30.09.2015
Gross NPA	1498.73	1304.58	1031.05	1498.73
Net NPA	674.84	48,4.47	318.50	674.84
% of Gross NPA	2.59	2.90	2.10	2.90
% of Net NPA	0.98	1.33	0.66	1.33

  

Restructured Advance  Rs Crores	2888	2763
Standard	2445	2456
NPA	444	307
% of Restructured Advance	5.58	5.62

http://www.federalbank.co.in/documents/10180/5777664/Investor+Presentation-Q2-FY16/9d210919-8d8e-4582-bd45-97762dd3e8f3

http://www.federalbank.co.in/financial-result

This blog recommends no investment or divestment. Views expressed here are without any risk or responsibility.

Are Indian banks camouflaging NPA ? Private sector Banks - Are they followers of Public Sector ? Case Study 5

South Indian Bank : NPA & Restructured Advances
Rs Crs	Q2 - FY16	Q2- FY15	Y-o-Y
GNPA	892.25	553.18	61.30%
NNPA	549.56	318.43	72.58%

               

Restructured Advances

Opening Balance	Add	Increase Bal	Upgrades	Decline Bal	30.09
2170	95	69	0	21	2313

NPA Rs Crores Restructured: Rs 313 crores  restructured

Other restructured : Rs.2000 crores

Source: https://southindianbank.com/UserFiles/file/Rupay/Results/SIB_Investor%20Presentation_October%202015.pdf

Investor Presentation October - 2015

This blog recommends no investment or divestment. Views expressed here are without any risk or responsibility.

Are Indian banks camouflaging NPA ? Case Study 4

Punjab National Bank Position as on 30 September 2015

	Standard Adv. (Excl. Std. Restructured) *	Restructured Standard (O/S) Cumulative (As on 30/09/15)	NPA	Gross Advances
FY 2014-15	329358	37369	25695	392422
Sep’15 (HY)	328903	38261	24945	392110

*This includes restructured NPA amounting to Rs. 3612 cr. as on Sep’15

Punjab National Bank Position as on 30 September 2015
	Sep’14	Mar'15	Sep’15
NPA as at the beginning of Yr	18880	18880	25695
Fresh Addition	6574	16660	5995
Gross NPA%	5.65%	6.55%	6.36%
Net NPA%	3.26%	4.06%	3.99%

http://pnbindia.in/new/Upload/English/Financials/PDFs/Investor_ppt_Sept15.pdf

This blog recommends no investment or divestment. Views expressed here are without any risk or responsibility. 

Are Indian banks camouflaging NPA ? Case Study 3

Indian Bank's NPA Reduction is largely on account of technical write offs?

Gross NPAs opg.	5670.44	5815.15
Fresh NPAs	496.36	547.04
Reduction	351.65	589.41
Gross NPA closing	5815.15	5772.78
Gross advances	124998.32	125291.64
Gross NPA as % to GA	4.65%	4.61%
Cash /comp. recovery	122.95	222.85
Upgradation	47.59	6.53
Tech. write off/write off/Exch.diff.	181.11	360.03

 http://www.indian-bank.com/pdfs/fin/sep15/PresentationonPerformanceoftheBank30092015

Q2 15-16: Case Study of DENA Bank        

Gross NPAs Rs In Crores	5,282.62
Gross Credit	77,204.38
Gross NPA as % of Gross Advances	6.84
Net NPA	3,493.45
Net NPA as % of Net Advances	4.65
Slippage into NPA  Advances  during half year 2015 Rs In Crores	1,540.91

Total Restructured Assets position as on 30.09.2015

Amount  Rs Crores

10,379.56

http://www.denabank.com//uploads/files/1448100424077-Analyst%20PPT_FinalFinalRevisedRevised2pm_Sept15.pdf

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