This is why Banking stocks are down?


Bank gross NPAs to touch 3.5% by March 2011: CARE, Reflecting the trend of
sizable chunk of restructured assets turning into bad loans, rating agency
CARE has pegged Indian banking sector’s gross non-performing assets (NPAs)
at 3.5 per cent of gross advances by March 2011.
http://www.business-standard.com/india/news/bank-gross-npas-to-touch-35-by-march-2011-care/405975/

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*It expects 15 per cent restructured assets to be converted into NPAs in
FY11. This was in addition to the normal system NPAs, CARE said. *Although
domestic growth drivers continue to remain robust, the pace of global
recovery continues to remain uncertain. Hence managing credit growth and
asset quality while sustaining earnings growth would be key challenges for
banking industry, it said.

At the time of reviewing the banking sector’s performance for the nine
months ended December 2009, CARE had projected gross NPA levels at 2.8 per
cent (approx) by March 2010. The overall gross NPAs of all scheduled
commercial banks (SCBs) stood at Rs 81,813 crore (2.5 per cent of Gross
Advances) as on March 31, 2010.

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