While the nonperforming assets (NPA) and slippages continue to rise for the banks, ICICI Bank CEO Ms. Chanda Kochhar feels the issue of NPAs and rising bad loans is being exaggerated.
She differed from RBI's view on the asset quality which said the banking and financial sector will see some troubled times ahead in this fiscal mainly due to poor asset liability management. Ms. Kochhar also said that "Temporary cash-flow problems in projects with gestation period of as much as 15 years don't make it a bad loan."
The banks added about Rs. 11,000 crore in bad loans during the first quarter. Industry experts suggest that unless the economy progresses, which means improvement in growth rate and reduction in inflation, there are hardly any chances of NPAs going down.