Summary:
Market players say this indicates that the ability of bank clients to repay loans has dropped sharply over the years. Economist Hemantkumar Shah said that the rising NPAs indicate a slowdown in Gujarat's economy, depleting the ability of clients to repay loans. However, overproduction because of intense competition may have hurt earnings and therefore the ability to repay loans, he said. Bankers in the know of things said it is because of rising NPAs that the Reserve Bank of India (RBI) had initiated Prompt Corrective Action (PCA) against certain banks. Gross Non Performing Assets (NPAs) of banks stood at Rs 38,520 crore, 11.45 per cent higher than Rs 34,563 crore in the corresponding quarter in the previous fiscal and 70 per cent higher than Rs 22,659 crore in the corresponding quarter of 2015-16..