70% reported fall in profits from Punjab National Bank has returned the spotlight to the issue of bad loans in India , as its banking system struggles under $ 100bn of stressed loans, which is in turn impacting economic growth. Although state-run banks, who account for The 93% of all outstanding bank loans, have borne the brunt, private lenders such as Punjab National Bank have also been hit. "The next quarter as well ... I should say the clean-up process is underway," she said of the three months to March. Q3 's banks have been battling with asset quality issues for four years however the recent hike in bad loans has been attributed to the Reserve Bank of India 's rule that banks treat some stressed borrowers as non-performing even if they have not yet defaulted. A large proportion of the loans being written off are from the steel and power sectors.
70% reported fall in profits from Punjab National Bank has returned the spotlight to the issue of bad loans in India , as its banking system struggles under $ 100bn of stressed loans, which is in turn impacting economic growth. Although state-run banks, who account for The 93% of all outstanding bank loans, have borne the brunt, private lenders such as Punjab National Bank have also been hit. Q3 's banks have been battling with asset quality issues for four years however the recent hike in bad loans has been attributed to the Reserve Bank of India 's rule that banks treat some stressed borrowers as non-performing even if they have not yet defaulted. A large proportion of the loans being written off are from the steel and power sectors.