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SBI Chairman Rajnish Kumar says blanket moratorium extension not needed after August 31

In May, SBI had announced an extension of the moratorium by three months to August amid the ongoing coronavirus crisis

twitter-logoBusinessToday.In | July 10, 2020 | Updated 21:20 IST
SBI Chairman Rajnish Kumar says blanket moratorium extension not needed after August 31
I expect the RBI to take a calibrated approach on the issue,Kumar said

State Bank of India (SBI) Chairman Rajnish Kumar on Friday said that across the board blanket extension of moratorium deferment is not needed after August 31. In May, SBI had announced an extension of the moratorium by three months to August amid the ongoing coronavirus crisis. Reserve Bank of India (RBI) will now have a clear data from all banks and it will take an appropriate decision regarding this, Kumar said while speaking at a two-day virtual conclave organised by SBI.

"It is premature to predict that there will be an extension of moratorium till December," he added. "Some sectors have been severely affected. I expect the RBI to take a calibrated approach on the issue," Kumar said.

Adding, he said the SBI data showed that there is a rise in bad loans due to the coronavirus crisis but it is "manageable".

People have been cautious about increasing their liabilities by opting for the moratorium, especially in the retail, agriculture and MSME sectors, he said. "The corporate houses have opted for the moratorium. The intent is to preserve cash. It is not that they were unable to pay," Kumar said. He said the most-affected sectors are aviation, hotel and tourism which need help. The impact of the COVID-19 pandemic is severe than the 2008 global financial problem, the SBI chief said.

"COVID-19 has caused gigantic disruption of the Indian economy along with dislocation of the supply chain. April was the worst month. Things had slightly improved in May, while the recovery started from June," Kumar noted.

Also read: COVID-19 fallout: Home sales plummet 67% in April-June across Mumbai, Bengaluru, other major cities

Also read: Airborne transmission of COVID-19 a possibility, needs urgent research: WHO

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