Yes Bank , the country's seventh-largest lender by market value, said in its annual report that in March 2016 -- yes, one year ago -- its non-performing loans were $768 million according to a central bank review of asset quality, and not the $117 million reported in the company's audited accounts. The MSCI India Financials Index, in which Yes Bank has the third-highest weighting, trades at a price-to-book ratio of 2.4 times, compared with 0.9 for a similar Chinese benchmark. On a price-to-truth basis, Indian banks look overvalued.The extent of overvaluation will become clearer when State Bank of India Ltd., the largest by assets, announces full-year results on Friday. Punjab National Bank Ltd. will report on Tuesday, and Bank of Baroda Ltd. on Thursday. With that, the growing expectation that the most knotty cases of botched corporate debt will get resolved in 90 days would look like more hype than hope.The more stratospheric the price-to-truth multiple for Indian banks, the bumpier may be their return to terra firma.

Source: Economic Times May 15, 2017 07:41 UTC