Public sector banks have been reeling under a huge stockpile of bad loans. Photo: AFPMumbai: Public sector banks will see their capital ratios deteriorate as provisions increase owing to prolonged asset quality pressures, global ratings agency Moody’s Investor Service said in a note on Thursday. “We expect the capitalisation profile of the PSBs to further deteriorate, unless the government provides additional capital support,” Moody’s said. The 24 public sector banks were the worst performers, having reported an aggregate loss of Rs.10,911 crore in the December quarter compared to a profit of Rs.6,970.8 crore in the year-ago quarter. Moody’s estimates that 11 banks will need capital of Rs.1.2 trillion by the year 2020 as against the Rs.45,000 crore the government has planned for in its budget.

Source: Mint June 10, 2016 06:41 UTC