SBI chairman Arundhati Bhattacharya expects the lender to further bring down its gross NPAs going forward. Excerpts from a media interaction:
How did SBI fare in terms of restructured accounts?
We restructured loans worth R11,885 crore in Q4. The amount was a little higher than expected due to window shutting. With any restructuring to be taken as NPA from April 1, many accounts showing weakness opted for recast as people don’t want an NPA tag.
Fresh slippages have come down. What is the restructuring pipeline like?
Fresh slippages have indeed come down and that’s showing up in our continuing strong performance on the net interest income (NII) front, as lower the slippages, the higher the NII.
The restructuring pipeline stands at R2,625 crore, which needs to be taken care of within the RBI window of 120 days, that is, by June 30.
What’s your outlook on advances for this fiscal?
The project pipeline was very thin even during the last quarter. We now have started seeing more projects coming in.
There is a lot of talk, both from the government side as well as many interested people, and some of these projects are now getting submitted. So, I expect a pick-up in credit growth in another two quarters. Considering this, I could call the loan growth to be around 14% for the year.
What about gross NPAs?
NPA numbers show that stress is coming down. Therefore, we do believe that, over a period of time, we could bring it further down. RBI has agreed to our request of spreading the losses on the sale of bad loans to ARCs to eight quarters, for another year. We have also seen good recoveries.
Which sectors do you feel could be a cause for concern?
Construction, power and iron & steel are sectors that could remain under stress.