News
Indian economy, financial system remain robust and resilient, says RBI
Bombay:
The Indian economy and financial system remain robust and resilient, anchored by macroeconomic and financial stability.
With improved balance sheets, the country’s banks and financial institutions are supporting economic activity through sustained credit expansion, according to the RBI’s Financial Stability Report released on Thursday.
The gross non-performing assets (GNPA) ratio of scheduled commercial banks fell to a multi-year low of 2.8 per cent and the net non-performing assets (NNPA) ratio to 0.6 per cent at the end of March 2024, the report said.
Non-banking financial companies (NBFCs) also remain healthy with CRAR at 26.6 per cent, GNPA ratio at 4.0 per cent and return on assets (RoA) at 3.3 per cent, respectively, as of end-March 2024, it adds.
According to the RBI report, the capital to risk-weighted assets ratio (CRAR) and common equity tier 1 (CET1) ratio of scheduled commercial banks (SCBs) stood at 16.8 per cent and 13.9 per cent, respectively, at the end of March 2024.
The report says macro stress tests for credit risk reveal that SCBs would be able to meet minimum capital requirements, with system-wide CRAR in March 2025 projected at 16.1 percent, 14.4 percent and 13.0 percent, respectively, below the benchmark, medium and severe stress scenarios.
These scenarios are rigorous conservative assessments under hypothetical shocks and the results should not be interpreted as predictions.
The financial stability report also notes that the global economy is facing increased risks due to prolonged geopolitical tensions, high public debt and slow progress in the last mile of disinflation.
Despite these challenges, the global financial system remained resilient and financial conditions stable.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
Featured video of the day
Heavy rain hits parts of Delhi-NCR