These reports have also shown that the condition of Indian banks continued deteriorating during the UPA-2 tenure.

The latest report of broking and research firm Credit Suisse says, the financial health of India Inc is declining as the companies have interest cover (IC) <1 at 37 percent in Q3 as compared to 34 percent in Q2.

According to the report of global agency UBS, gross NPAs of Indian banks between two general elections (2009 and 2014) have soared from Rs 69,000 crore to an estimated Rs 2.8 lakh crore.

The NPA scenario has worsened in the first half of 2012-13, with gross NPA growth rate at 45.7 percent being far higher than the growth in gross advances by banks in India.

Realty giants like DLF, JP Associates, GVK Construction, GMR Infrastructure have large amount of debt on their balance sheets.

Outgoing RBI Deputy Governor KC Chakrabarty has also blamed the public sector banks for the growing bad loans.

According to Chakrabarty, the public sector banks are more responsible for the menace of bad loans than their private sector counterparts.

He has also turned down the banks’ claims that the economic slowdown has affected ‘public sector banks alone’.  Private sector banks and even foreign banks have been able to deal with the NPA menace better, Chakrabarty had said.

Chakrabarty had also raised the issues at United Bank of India (UBI), which is struggling with a high level of asset stress, saying the problem exists due to poor corporate governance practices.

"All issues point towards corporate governance. We have written to the government to take a set of steps to improve corporate governance and it is not only for UBI but the entire banking system as a whole," Chakrabarty had told reporters on Wednesday.

The government owns 26 banks which account for over three-fourths of the banking industry. Most of them are facing an unprecedented rise in bad loans.

Bad loans and restructured loans as of the December quarter accounted for over 10 percent of the system. Banks, mostly PSBs, recast close to Rs 1 trillion of bad loans in the previous financial year, taking the total corporate debt restructuring book to over Rs 38 trillion so far.

JPN/Bureau

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