Indian banks’ asset quality may deteriorate but lenders have enough capital to withstand a severe shock, said the bi-annual Financial Stability Report, prepared taking inputs from all the financial regulators and released by the Reserve Bank of India (RBI), on Wednesday.
A similar sentiment was expressed by the RBI’s trend and progress report released on Tuesday. It had said the asset quality of banks and non-banking financial companies (NBFCs) will witness pressure as regulatory forbearance and standstill on asset classification come to an end in a few months.
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