NPA risk is one of the biggest problems for small banks
By Joseph Samson
Oct 24, 2013
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State Bank of India, the nation's biggest bank, might have the most elevated extent of terrible obligation, however it is the more diminutive players of the public sector, that experience the ill effects of focus hazard, with non-performing assets (NPA's) who fall under the first 30, representing over half the sticky holdings.

What includes to the force small banks is the way that a few of them, for example Bank of Maharashtra and Corporation Bank, saw rebuilt accounts transform into NPA's. While the normal for open area banks was 27% throughout the June quarter, in the event of Bank of Maharashtra, almost half the rebuilt accounts, which were under monetary strain, turned NPA. At second position it was State Bank of Travancore (48%), emulated by Syndicate Bank (45%) and Canara Bank (43%).

On Tuesday P Chidambaram, the finance minister, stated that borrowers who have taken huge loans, which is above Rs. 1 crore, are defaulting. This is now becoming a matter of concern. This statement was made after a meeting with the chiefs of banks, emphasizing the need to screen the 30 NPA accounts in every bank in every zone.

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