On December 28, 2023, the RBI released the 28th edition of the Financial Stability Report (FSR), offering insights into the collective evaluation of the financial stability and development council's sub-committee(FSDC) on the risks and resilience within the Indian financial system.
Chief General Manager Yogesh Dayal signed off on the report, signaling confidence in the Indian financial system's strength amidst challenging global landscape.
The report notes the global economy is struggling with multifaceted challenges, including the prospect of slowing growth, escalating public debt, increasing economic fragmentation and prolonged geopolitical conflicts. However, it sheds light on the resilience of the Indian Economy despite global headwinds. Showcasing how it is attributed to robust macroeconomic fundamentals, healthy financial insitituion's balance sheets, moderating inflation and an improved external sector.
RBI pointed to the commercial bank's performance, tracing back to September 2023, how scheduled commercial banks(SCB's) maintained a Capital to risk-weighted assets ratio(CRAR) at 16.8% and a common equity tier 1(CET1) ratio at 13.7%. Moreover, applauding how gross non-performing assets (GNPA) reached a multi-year low of 3.2% and net non-performing assets(NNPA) ratio at 0.8%.
Additionally, the report draws focus to the non-banking financial companies(NBFCs) improved performance as well, with a capital to risk-weighted assets ratio (CRAR) of 27.6%, a GNPA ratio at 4.6% and a return on assets (RoA) at 2.9% as of September 2023.
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