New Delhi, October 02: Indian banks are expected to remain robust during the current fiscal and the next even if non-performing assets and interest rates rise, according to global rating agency Fitch.
“… the Indian banking system is expected to remain resilient even under rigorous stress assumptions on both asset quality and profitability during FY10 and FY11,” the global ratings agency said.
The impact of the agency’s ‘stress test’ on 30 Indian banks accounting for 78 per cent of system assets indicated that capital is protected for a majority of the banks, while some of the weaker banks would need to raise core capital in order to better prepare for the current downturn in the credit cycle.
“Fitch expects system profits at the aggregate to be able to absorb sharp increases in credit cost, leaving the aggregated capital unimpaired,” the agency said.
–PTI