New Delhi, Oct. 21 (PTI): Finance minister P. Chidambaram will meet the heads of public sector banks tomorrow to take stock of their non-performing assets (NPAs), credit growth and financial performance.
The broad agenda of the meeting includes reviewing ways to cut down deteriorating asset quality. Credit growth in the targeted sectors is also a part of the agenda, a senior finance ministry official said.
Gross NPA of state-run banks rose to Rs 1.76 lakh crore at the end of the June quarter from Rs 1.55 lakh crore on March 31, 2013. The ratio of gross NPA to gross advances for commercial banks rose to 3.92 per cent in June 2013 from 2.36 per cent in March 2011.
The financial performance of PSU banks will also be reviewed, the official said.
Chidambaram is expected to ask banks to give their assessment of the additional funding they will require to give loans at lower interest rates to sectors such as auto, consumer durables and housing to stimulate the economy.
The decision to increase the capital infusion was taken at a meeting among Chidambaram, RBI governor Raghuram Rajan and economic affairs secretary Arvind Mayaram earlier this month.
“This amount (Rs 14,000 crore provided for capital infusion in Budget 2013-14) will be enhanced. The additional amount will help banks to lend to sectors such as two-wheelers and consumer durables at lower rates to stimulate demand,” a finance ministry statement had said.