According to the Reserve Bank's Report on `Trend and Progress of Banking inIndia for 1998-99', net NPAs moved up to Rs 24,211 crore in 1998-99 forstate-run banks from Rs 21,232 crore in 1997-98. "The declining trend ofNPAs of scheduled commercial banks witnessed till the year 1997-98 could notbe sustained in 1998-99", the report says.

However, gross NPAs as a fraction of total assets declined to 6.7 per centin 1998-99 from 7 per cent in 1997-98, while net NPAs as a percentage tototal assets declined to 3.1 per cent in 1998-99 from 3.3 per cent in1997-98.

The report said there has been a marked improvement in the loan portfolio ofstate-run in the category of "priority sector". "Sector-wise analysis ofNPAs of PSBs indicates that the share of NPAs of priority sector hasdeclined from to 43.7 per cent at March-end 1999 from 50 per cent atMarch-end 1995," the report said.

During the year 1998-99, the Reserve Bank report says, the level of grossNPAs to gross advances declined to 15.9 per cent in 1998-99 from 16 per centin 1997-98 mainly on account of a marginal reduction in sub-standard anddoubtful assets and concomitant increase in standard assets.

According to the report, while the NPAs of PSBs showed a marginal decline,an increase was witnessed in all other bank groups.

"During the year 1998-99, number of PSBs with net NPAs up to 10 per centincreased by 1 to 18 and the number of banks with net NPAs in the range of10 per cent to 20 per cent declined by one to eight, with one bankcontinuing to show NPAs above 20 per cent", the report said.

The annual report on banking trends pointed out that in case of foreignbanks, those with net NPAs upto 10 per cent declined to 27 from 34 over theyear and those above 20 per cent stood at 3 as against 2 in the last year.The number of foreign banks with net NPAs ranging between 10 to 20 per centincreased to 11 from 6 in the preceding year.

For old private sector banks, the number of them with the net NPAs below 10per cent was 17 against 21 in 1997-98 while those above 20 per cent were 3as against nil in the last three years.

The analysis done by the Reserve Bank shows with the exception of publicsector banks-NPAs of private sector and foreign banks witnessed increasesduring 1998-99.

In case of private sector banks, while the gross NPAs of all private banksincreased to 10.4 per cent in 1998-99 from 8.7 per cent during 1997-98, thenet NPAs to net advances indicated an increase to 6.9 per cent during1998-99 from 5.3 per cent during 1997-98.

A highlight is the substantial increase of NPAs among new generation privatesector banks where gross NPAs to total advances of private sector banksincreased to 5.7 per cent in 1998-99 from 3.5 per cent in 1997-98 was mainlyon account of marginal declines in standard assets, while the net NPAs tonet advances grew to 4.1 per cent in 1998-99 from 2.6 per cent.

The gross NPAs to total assets also increased to 2.3 per cent in 1998-99from 1.5 per cent in 1997-98.

Gross NPAs to total advances for foreign banks increased to 7 per centduring 1998-99 from 6.4 per cent during 1997-98 while net NPAs to netadvances during 1998-99 declined to 2 per cent from 2.2 per cent in 1997-98.