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Daily Current Affairs – 2020

Topic: For Prelims and Mains

RBI’s report on NPA

Why in News?

The gross non-performing asset ratio of banks may increase to 9.9 per cent by September 2020 from 9.3 per cent in September 2019, according to an RBI report.

The gross NPA ratio of banks stood at 9.3 per cent in March 2019.

Reasons as per the Report:

  • change in macroeconomic scenario
  • marginal increase in slippages
  • The denominator effect of declining credit growth.

Other findings of the report:

  • The aggregate provision coverage ratio (PCR) of all banks rose to 5 per cent in September 2019 from 60.5 per cent in March 2019.
  • PCRs of both state-run banks and private banks increased in September 2019.
  • Following the recapitalisation of state-run banks by the government, banks capital to risk-weighted assets ratio (CRAR) improved to 15.1 per cent in September 2019 from 14.3 per cent in March 2019.
  • The state-run banks’ CRAR improved to 5 per cent from 12.2 per cent during the same period.

Related terms:

About The provision coverage ratio (PCR):

It gives an indication of the provision made against bad loans from the profit generated. Higher the PCR, lower is the unexposed part of the bad debts.

About the Risk (Weighted) Assets Ratio (CRAR):

It is also known as Capital adequacy Ratio, the ratio of a bank’s capital to its risk. The banking regulator tracks a bank’s CAR to ensure that the bank can absorb a reasonable amount of loss and complies with statutory Capital requirements.

 

FACTS FOR PRELIMS

The Ratapani Tiger Reserve:

  • The Ratapani Tiger Reserve, located in the Raisen district of Madhya Pradesh, in Vindhya Range in central India, is one of the finest teak forests in the state and is less than 50 km. away from the capital Bhopal.
  • It has been a wildlife sanctuary since 1976.

The ‘Samabay Mela 2019’:

  • Samabay Mela-2019 was recently inaugurated at Netaji Indoor stadium, Kolkata.
  • The theme of ‘Samabay Mela’ this year is ‘Cooperation is the key towards poverty alleviation and eradication of unemployment in the state’.

 

 

 

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