situation report

Sep 4, 2013 | 11:20 GMT

1 min read

India: Crisis Threatens Asset Quality, Industry's Demand For Bank Credit

Slowing economic growth and steep currency depreciation in India are threatening to harm asset quality and large industrial companies' demand for bank credit, the Financial Times reported Sept. 4. Levels of nonperforming and restructuring loans in India have climbed steadily over the past year to around 9 percent of assets and could go as high as 15.5 percent in the next couple of years, according to Morgan Stanley. Weaker economic growth, declining business confidence and Indian central bank measures to support the rupee will further affect asset quality, particularly as large industrial firms struggle to repay their loans.

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