NPA meter for moratorium loans to start ticking from September

SBI Chairman Rajnish Kumar on Friday said that 82 per cent customers have paid two or more instalments of loans during the COVID-19 period. "There are 92 per cent customers who have paid one or more instalments, while only 13 per cent customers in the corporate segment have availed moratorium and the amount is insignificant," said Kumar in a media interaction.

The bank, however, did not give the percentage share of moratorium book in terms of value. The banks such as Bank of Baroda and IDBI Bank have announced that 65 per cent of their loan book is under moratorium. The private banks have seen one third of their book in terms of value under moratorium.

SBI's domestic loan book is around Rs 20 lakh crore. "We haven't calculated the value of moratorium. We are monitoring the number of customers or the accounts," said Kumar.

The largest bank in the country says the SME portfolio historically and traditionally has had higher slippages, but in the current circumstances, the delinquencies  are not going to be substantially higher. "Various enablers and tools are available for SMEs to deal with the situation," says Kumar.

The bank has also cleaned up its agriculture portfolio in the past. So far as the retail is concerned, more than 70 per cent customers under home loans are salaried class, says the bank.

"We have to wait for another quarter to have a better assessment," says Kumar. The bank's policy of diversification across industry segment is currently holding the bank in a good stead. "I don't intend or need to go to the government or the market for raising capital. This is again our assessment as of now," says Kumar.

The bank already has an an enabling provisioning for raising Rs 20,000 crore capital.

"We are in a position to deal with any unusual situation," says Kumar. SBI has built different stress case scenarios on the way moratorium book will behave post the opening of the lockdown. He, however, said that the market has to wait for a quarter to see the exact impact of the COVID lockdown.

"By the end of June, the bank will have more clarity on the provisioning pressure related to COVID stress. By September, the NPA meter would start as the bank would start disclosing special mention accounts from a single day default to 90 days."

Kumar further said that the bank is strong in terms of balance sheet and is providing for provisioning wherever required.

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