India city Mumbai covid-19 economy Government crisis India city Mumbai

Banks to feel capital pinch as asset quality takes covid-19 hit

Reading now: 584
www.livemint.com

MUMBAI : The 21-day lockdown to counter the covid-19 crisis, sluggish economic growth and the consequent rise in bad provisions will exert pressure on the capital adequacy of banks, ratings agencies have warned.

The effects, experts said, will be more pronounced for public sector banks (PSBs) where the government has not allocated any infusion in the current financial year and expects them to tap the markets for capital.

Moody’s went to the extent of revising the outlook for the Indian banking system to negative from stable earlier. According to Moody’s, surge in loan loss provision along with a decline in revenue will hurt the profitability of banks, leading to a deterioration of capitalization.

Read more on livemint.com
The website covid-19.rehab is an aggregator of news from open sources. The source is indicated at the beginning and at the end of the announcement. You can send a complaint on the news if you find it unreliable.

Related News

DMCA