“NPAs are the biggest source of concern. A majority of these NPAs, which came from mid-corporate and SME segments, were driven by low demand, cash flow issues, inability to pass on costs and low profitability, among others,” Gupta told newspersons on the sidelines of a banking colloquium organised by the Confederation of Indian Industry.
The bank, however, expects its NPA situation to improve in the next few quarters.
Responding to a query on the impact of the cancellation of allotted coal blocks, Gupta said that it might not result in a surge in its NPAs. “We are very hopeful that this will get resolved in sometime. Right now projects are under implementation. I think we will have a solution in the next three to six months. Things should be fine as far as banks are concerned,” he said.
According to him, a total of projects of 50,000 MW involving an investment of around Rs 2.5 lakh crore were under various stages of implementation. “If you take away Rs 50,000-75,000 crore of the promoter, then you have Rs 1,75,000 crore of funding. That is a large sum, but that does not mean everything of that will be stressed,” he said. The bank’s exposure to the power sector stands at about Rs 50,000 crore.
Even while there has been a dip in credit offtake, SBI expects 18 per cent growth in credit this year, compared with 15.6 per cent last year. “The credit growth is lagging behind the deposit growth at present. In the last five months we have accrued deposits worth Rs 74,000-75,000 crore while we have been able to lend only Rs 15,000 crore,” he said.
The bank is hoping for infusion of Rs 4,000 crore by the end of this fiscal.