Already burdened by bad loans, 37 banks, led by public sector ones, have reported a 26.8 per cent rise in non-performing assets (NPAs) over the 12-month period ending September this year.
This is a nearly 10 per cent rise from the 16.9 per cent growth in bad loans over the same period a year ago, with several projects, especially those in the infrastructure sector, stuck.
While the overall NPAs now amount to Rs 3,36,685 crore, the rise in the last 12 months ended September 2015 was Rs 71,000 crore, according to figures compiled by credit rating CARE.
The banks with a major share in bad loans include Bank of India, Bank of Baroda, Indian Overseas Bank, SBI and Punjab National Bank.
The figures show a continuous acceleration in the growth of NPAs, from 4 per cent in the second quarter of FY2014 to 4.2 per cent in Q2 of FY2015 and 4.9 per cent in the second quarter of FY2016.
At the same time, in the second quarter of FY16, net profits of banks also declined, by 1.5 per cent, compared to the positive growth rate of 29.5 per cent in the same period last year. The net profit margin came down to 7.7 per cent from 8.3 per cent during this period.
Among the big banks, the bad loans of Bank of India soared from Rs 14,127 crore to Rs 29,893 crore, of Bank of Baroda from Rs 13,057 crore to Rs 23,710 crore, and of Indian Overseas Bank from Rs 13,333 crore to Rs 19,423 crore.
The silver lining is SBI, India’s largest bank, whose asset quality improved, with gross NPAs as a percentage of gross advances falling 74 bps to 4.15 per cent (Rs 56,834 crore) from 4.89 per cent (Rs 60,712 crore).