NPA provisioning for banks moderates in Q2 driven by PSBs

By

, ET BureauLast Updated: Nov 19, 2024, 07:30:00 PM IST

Synopsis

Provisioning for bad loans by banks fell in the September quarter for the second consecutive period based on year-on-year comparison driven by the public sector banks (PSBs).

Provisioning for bad loans by banks fell in the September quarter for the second consecutive period based on year-on-year comparison driven by the public sector banks (PSBs).

For a sample of 29 publicly listed banks, provisioning for non performing assets (NPA) fell by 2.9% to Rs 27,318.2 crore. For PSBs, it fell by 11.6% to Rs 14,628.3 crore with half of them reporting a year-on-year drop in loan loss provisioning. PSBs including Punjab National Bank, Central Bank of India and Indian Overseas Bank recorded 82-93% fall in the NPA provisioning.

ETMarkets.com

On the other hand, private sector banks showed 12.5% increase in NPA provisioning for the quarter to Rs 12,690 crore, led by select banks including ICICI Bank, Axis bank, Kotak Bank, IDBI Bank and Federal bank.

ETMarkets.com

Three out of every four private sector banks reported a year-on-year increase in their NPA provisioning. As a result, their share in the quarterly NPA provisioning increased to 46.5% from 41.2% a year ago and 42.1% in the previous quarter.

ETMarkets.com

On the income front, private sector banks performed better than the PSBs. The total sample’s net interest income (NII) grew by 6.5% year-on-year to Rs 1,98,668 crore led by 11.3% growth in the aggregate NII of the private banks at Rs 96,122.7 crore. NII for the PSBs rose by a modest 2.4% to Rs 1,02,545 crore.

Each of the 17 private sector banks and 10 out of 12 PSBs in the sample reported a year-on-year growth in NII for the September quarter. The share of private banks in the sample’s NII improved to 48.4% from 46.3% in the year-ago quarter and 47.6% in the prior quarter.

...moreless

...moreless