Coronavirus: Banks brace for payment defaults, missed targets
Bankers are also expecting the Reserve Bank of India(RBI) to come out with a forbearance package so that accountsare not classified as NPAs for the next few years.
"There should be some forbearance on account of cashflow mismatch. There will be many defaults in the MSME, retailand related sectors," a senior United Bank of India officialtold .
"We are expecting the RBI to come out with such apackage so that accounts are not categorised as NPAs for atleast the next two years," he said.
Prior to the virus outbreak, the state-run lender,which is set to be merged with Punjab National Bank (PNB), wasin profits.
"We wanted to close the financial year with a businessfigure of Rs 2.18 lakh crore. But because of this development,there will be a shortfall," the official said.
On UBI's realisation from the resolution processthrough the Insolvency and Bankruptcy Code (IBC), he said thebank's exposure to Bhushan Power was Rs 800 crore.
"But going by the current trends, that amount is notimmediately forthcoming and it is a big blow to the bank," headded.
An official of city-based UCO Bank said that due tothe virus scare, pace of work in all its branches has taken amajor hit.
"This is a very tough quarter. Some recoveries aretypically realised in the last few days of the March quarter.That will be impacted," he said.For UCO Bank, cases admitted before the NationalCompany Law Tribunal (NCLT) total to Rs 15,811 crore, out ofwhich the bank has realised around Rs 3,000 crore, theofficial said. DCRBT RBT
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