Credit Growth Slowing Down

There wil be newer NPAs coming up for the banking sector. Lot of developers are under stress and may go bankrupt.HDIL was the first case. The entire Anil Ambani group has about Rs 2 lakh crore in loans and may go in for bankruptcy. R.Comm, R. Power, Reliance Capital and its subsidiearies, RNAVAL. Add companies like Suzlon, DHFL, IL&FS. Also companies in the Infrastructure construction could all go in for bankruptcy. Some Auto Ancillaries may also face similar challenge. The fate of atleast Voda Idea will also need to be watched. They have loans of around Rs 1.2 lakh crores and if are not able to revive, things could be really ugly. One more sector that is not been discussed is the SME sector. This sector is facing lot of stress and could be a newer source of NPA.. So, on the one side there will be some slow recovery from NCLT case resolution and on the other side there will be newer NPAs. Now one must also understand that the credit growth is slowing down sharply and that will also affect the
banking sector.

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