As of June, nearly 10% of SBI’s loan book was bad, adding up to a massive gross bad loan stock of Rs1.9 trillion. Farm loan waivers, end of forbearance on loan classification related to demonetization and the merger itself bit SBI badly during the June quarter. In short, bad loans from this segment would actually come down to Rs7,503 crore from the Rs13,532 crore in the June quarter. Write-offs amounted to Rs13,176 crore and adding the accretion to gross bad loan stock, it is close to Rs43,000 crore. The fact that SBI’s loan book hardly grew while existing loans decayed faster is a clear indication that the economy is still limping.

Source: Mint August 11, 2017 19:07 UTC