NNPAs of 25 PSBs up 10.7%, GNPAs decrease 1.6% in Q1

Written by Pradip Kumar Dey | FE Research Bureau | Updated: Aug 22 2007, 05:52am hrs
The net non-performing assets (NNPAs) of 25 public sector banks (PSBs) increased by 10.7% to Rs 14,138 crore in April-June 2007 from Rs 12,767 crore in April-June 2006. However, the gross non-performing assets (GNPAs) of these PSBs decreased by 1.6% to Rs 36,659 crore during the same period.

Some PSBs are trying to recover the NNPAs as per the RBI schemes as well as their own recovery schemes. State Bank of Indore (-43.2%), Indian Bank (-39.6%), Bank of India (-38.8%), State Bank of Saurashtra (-31.5%), Union Bank (-26.8%) and Dena Bank (-22.3%) have reduced their NNPAs in the first quarter of this fiscal.

The Bank of India made the highest recovery of Rs 380 crore during Q1. M Balachandran, chairman and managing director, Bank of India, said: Strict credit monitoring, upgradation of accounts, compromise, disposal of impaired assets, cash recoveries and enforcements under the SARFAESI Act helped us to reduce NNPAs.

The average NNPAs to net advances ratio of 25 PSBs declined from 1.11% in Q1 2006 to 0.89% in Q1 2007. A similar trend was seen in the case of 16 PSBs during April-June 2007. The NNPAs to net advances ratio of Dena Bank decreased from 3.25% in Q1 2006 to 2.07% in Q1 2007, Indian Bank from 0.57% to 0.28%, Bank of Maharashtra from 1.93% to 1.19%, Bank Of Baroda from 0.92% to 0.67%, Union Bank from 1.22% to 0.78% and Vijaya Bank from 0.85% to 0.49%.

An opposite trend was seen in the case of PNB, which increased the ratio of NNPAs to net advances from 0.35% to 0.98%.

The NNPAs of PNB increased by 248.1% (highest among the 25 PSBs) to Rs 925.69 crore in April-June 2007 from Rs 265.9 crore in April-June 2006.

The top five banks according to the ascending order of the ratio of NNPAs to net advances in the first quarter of this fiscal are: UCO Bank (2.54%), Dena Bank (2.07%), SBI (1.62%), State Bank of Bikaner & Jaipur (1.31%) and Bank of Maharashtra (1.19%). In April-June 2006, the top five were: Dena Bank (3.25%), State Bank of Indore (2.32%), UCO Bank (2.09%), Bank of Maharashtra (1.93%) and SBI (1.84%).

Four banks, namely Dena Bank, SBI, UCO Bank and Bank of Maharashtra, appear in the list of top five during both the time periods. The highest and lowest NNPAs were observed in April-June 2007 by the SBI (Rs 5,505 crore) and Andhra Bank (Rs 51.17 crore) respectively.