Banks slippages to continue due to stress from various sectors: ICRA

The private banks, due to their higher credit cost in FY20, will see muted RoE at 9-10 per cent

Due to stress emerging from the real estate, micro, small and medium enterprises (MSMEs), the non-banking space and also on the retail front, the gross slippage of the banks in FY20 will be at an elevated level at around Rs 2.8 trillion to Rs 3.2 trillion, rating agency ICRA said in its outlook for banking sector.

“Gross slippages are estimated to remain elevated at 3.2-3.6 per cent of standard advances during FY20 as compared to 3.9 per cent during FY19”, said ICRA.

In Q1FY20, fresh gross slippages stood at Rs 85,643 crore as compared to Rs 77,784 crore in Q4FY19 and Rs