Global credit rating agency, Care Ratings in its latest research report on ‘Performance of banks’ has said that the Indian banking industry continued to remain under pressure in the first quarter of current financial year (Q1FY18) because of slower pace in growth rate of credit and deposits, it added that the non performing assets (NPAs) also remained high as of June 2017.
The report stated that , growth in bank credit to agriculture and allied activities, services, industry and retail sector (personal loans) was lower as of June 2017 as against the same period in the previous year, while credit growth to manufacturing also remained sluggish, continuing to be negative. However, the agency found that the banks registered healthy other income in Q1FY18, driven by their profit in treasuries, while the net profits of the banks also witnessed growth.
Care Ratings further noted that overall volume of bank’s business has still to pick up which will depend on the economy of the country. Besides, the agency found public sector banks are more stressed than private banks and said that gross NPAs’ growth lowered in the first quarter of FY18 as against same period in previous year, increasing by 25.8%.