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Asset Quality & Risk Management Practices - An Analysis on Yes Bank

Article  in  SSRN Electronic Journal · January 2018

DOI: 10.2139/ssrn.3510944

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Running head: ASSET QUALITY & RISK MANAGEMENT AT YES BANK 1

Asset Quality & Risk Management Practices - An Analysis on Yes Bank

VIJAYA KITTU MANDA

Research Scholar, GITAM Institute of Management,

GITAM Deemed to be University, Visakhapatnam, Andhra Pradesh, India 530 045

Contact: +91 98495 19188; Email: vijaykittu@hotmail.com

DR. ARUNA POLISETTY

Assistant Professor, GITAM Institute of Management

GITAM Deemed to be University, Visakhapatnam, Andhra Pradesh, India 530 045

Contact: +91 99514 50046; Email: arunakovvuru@gmail.com

CITING THIS RESEARCH PAPER

Vijaya Kittu, M., & Aruna, Polisetty. (November 9, 2018). National Conference on Non-Performing Assets – Disclose or Dispense:

Problems, Process and Progress. Visakhapatnam: GITAM Deemed to be University

ABSTRACT

Indian banks have a dual challenge of dealing with bad loans on one hand and hurrying to be fully BASEL III compliant on the

other. Both the Reserve Bank of India (RBI) and the Government of India are using various approaches over the past two decades to

help banks. Several different experiences are obtained by domestic and global banks in handling the non-performing loans (NPL)

problem. Yes Bank Limited is India’s 4th largest private sector bank. It has the industry-best NPA ratios and is renowned for its best

practises in the banking industry. Can risk management practices and focus on asset quality help banks maintain loan quality and even

stop loans from not slipping into the vicious Non-Performing Asset (NPA) cycle?

Data from quarterly & annual reports and other reports is collected to understand management philosophy and asset quality

dimensions such as NPA ratio, provisioning coverage ratio, concentration of NPAs, priority sector lending and restructuring of accounts.

As the bank evolved from a mid-size bank into a large-size bank in the last 14 years, it gives an opportunity to pose the question - Will

NPA size increase as bank transformed from a mid-sized bank to a large bank? Will knowledge-driven sectoral approach to assist

customers in their business by lending and offering industry specific financial solutions help the bank? Can technology be used to predict

and give early warnings before loans turns sour?

JEL CLASSIFICATION

G21, G28

KEYWORDS

Non performing asset, non performing loan, asset quality, risk management, knowledge banking, indian banks, banking in india, npa

ratio, provisioning coverage ratio, npa concentration, priority sector lending, gnpa, nnpa
Asset Quality & Risk Management Practices - An Analysis on Yes Bank 2

INTRODUCTION

Banking and finance businesses involve lending and bad-loans are an inevitable part of this. India committed to follow common

set of global banking standards by signing the Basel Accord. The Basel III is the latest evolution in the banking regulation and focuses

on capital, leverage and liquidity to handle banking crisis and ensure financial stability. A sound capital base for a bank requires cleaning

up of balance sheet by managing bad loans and India needs to do this quick so as to meet the March 2019 target of Basel III

implementation across all banks. A loan is an asset to the bank because it bring in income. Bank assets are classified into four types –

Standard asset (performing asset that continue generating income and repayments as and when they fall due), sub-standard asset (asset

not performing for up to 12 months), doubtful asset (assets not performing for more than 12 months) and loss asset (asset which are

irrecoverable either by the bank or the internal/external auditors or by the RBI inspection team). While “12 months” here is more like a

global standard, RBI is actively tweaking the period to lesser timeframes (such as 90-days) to speedup India’s move to international

norms (Sikdar & Munish, 2013). The NPA norms are uniform for all advances including Government-guaranteed accounts. However,

agricultural loans continue to be based on seasons.

Non-Performing Assets (NPA) is an asset that is no longer performing and ceases to generate income in the form of interest or

principal repayment. Because money gets locked (or lost), NPA affects credit rotation and credit creation and thereby became a dent to

the banking system and negatively impacts the economy. NPA has two variants – GNPA and NNPA. Gross NPA (GNPA) is sum of

advances defaulted for a period of 90 days. These ‘almost bad’ loans are still held in the book of accounts but cease to generate income

to the bank. Over time, it might so happen that the banks may not be able to timely recover the entire amount being lend and hence have

to do necessary provisioning. Net NPA (NNPA) is obtained by deducting provisions from the defaulted loans and an actual loss is

reflected in the books. Sensing NPA as a national priority problem, Government of India and central banker Reserve Bank of India

(RBI) are taking several attempts to help banks tackle the problem.

APPROACHES SO FAR

The level of NPAs has now become a bank assessment metric for measuring credit risk, asset quality and efficiency in allocation

of resources. RBI statistics says that Indian GNPA numbers are alarming compared to the US and other Asian countries but Indian

NNPA are better compared to global numbers because of the strict provision norms prescribed by Narasimham and Verma Committees

(Narasimham, 1991, 1998). Prudential norms and provisioning requirements made banks make provisions and to pro-actively clean-up

their balance sheets. DRTs, Lok Adalats and Securities and Reconstruction of Financial Assets and Enforcement of Securities Interest

Act, 2002 (SARFAESI Act) mechanisms are introduced but with limited success. RBI’s Corporate Debt Restructuring (CDR) Scheme,

2001 allowed a case-by-case restructuring of debt given to firms but this largely failed and very few companies were able to turn-around

and exit successfully. SARFAESI is a bold step towards handling NPAs but loan defaulters went to courts to put a break to its

enforcement. The Strategic Debt Restructuring (SDR) allowed banks to take the majority shareholder seat by making the companies

convert debt into equity. The variant Sustainable Structuring of Stressed Assets (S4A) scheme allows banks to convert unsustainable

debt to equity/quasi equity instruments. Yet another variant, the 5:25 scheme gave a longer time frame for the parties to deal with the

situation and the debt is structured so that more time will be given to the defaulter while the banks can preserve the loan at its net present

value for a longer timeframe.

Asset Quality & Risk Management Practices - An Analysis on Yes Bank 3

Much of the debts that corporates are unable to repay today have originated in the min-2000s when companies came out with

ambitious capex plans. Bank credit have doubled over a span of just three years (FY05 to FY09). The then RBI Governor Raghuram

Rajan has sent a letter to Prime Minister's Office (PMO) highlighting "high-profile fraud list" during 2006-08 that could potentially

become NPAs. He cited that over optimism of bankers, slowdown in global growth, a slow decision-making by Central Government,

malfeasance and frauds as the main reasons for the build-up of the trouble. Even the 2008-global financial crisis could only give a small

pause for this. Between FY10 to FY14, debt pace increased only to pause between FY14 to FY16 and again gain speed from FY16. The

2015 RBI Asset Quality Review (AQR) has unveiled some banking practises such as round tripping of funds, short term OD to repay

and then fresh loan to repay OD, sale of assets within group, inflating rates, same lenders, devolved L/C, late adjustments, changing

loan from non-fund based to fund based, drawing power manipulations etc. RBI turned strict and forced banks to do a regular clean-up

of books and handle the NPA issue so that banks can appear “evergreen”, at least on books. The Government feels that recognizing

NPAs is the first step in the clean-up process.

The introduction of Insolvency and Bankruptcy Code (IBC) is yet another attempt to give legal strength. The RBI referred 12

big defaulters and several small defaulters to the National Corporate Law Tribunal (NCLT). With IBC in force, RBI, on Feb 12, 2018

introduced an important circular withdrawing almost all debt restructuring schemes in force - CDR, SDR, S4A, Flexible Structuring of

Existing Long Term Project Loans. Even the Joint Lenders Forum is disbanded. RBI directed all banks to initiate a resolution plan as

soon as they witness payment delays starting March 1 and this means that banks need to go for out-of-court settlement for all accounts

over Rs 2,000 crores within 180 days. Failure to do so will mean the account will be referred to National Company Law Tribunals

(NCLTs) for insolvency action, within 15 days after the completion of the deadline. This forced banks to quicken the resolution process

so as avoid large haircuts or loan losses. The move has fastened the recognition, justification, restructuring, resolution, or recovery of

bad loans as the case may be. The June 2018 Financial Stability Report by RBI shows that as many as 701 cases are admitted for

resolution. As many as 70 cases (30 in power sector alone) got ready for IBC. However, some companies, particularly from Power,

Sugar and Shipping sectors, went to the Supreme Court of India (SC) in September 2018. The SC directed banks not to refer cases to

NCLT and transferred all cases challenging the RBI circular to itself and posted them for hearing in November 2018 adding more

uncertainty and delay to the issue. The breather gave banks like SBI which, along with other lenders, is attempting to resolve 7 to 8

stressed power assets. Another development is that the Government decided to merge Bank of Baroda, Dena Bank and Vijaya Bank.

Earlier during the year, SBI and its associated banks are merged so that a “mega bank” gets created. India Ratings said that the merger

of banks could raise NPAs in the short run because slippages will increase as recognition of NPA is “harmonized and accelerated” but

results in better efficiency going forward. The Ministry of Corporate Affairs quickly stepped in and announced it will use the Special

Courts approach to deal with Insolvency Cases which are likely to be set up by November 2018.

While IBC is still getting absorbed into the Indian banking system, it is apparent that the results are coming in slower than what

the Government expected. Added to this, both banks and defaulters feel that this “resolution system” is a lose-lose for them because

both of them have to part off a bit if they go under IBC. The recent Project Shashakt is a follow-up to IBC and suggests setting up an

Asset Management Company (AMC) (“Bad Bank”) to take over all bad debts with funding probably from Alternative Investment Funds

(AIF). The Pariwartan (Power Asset Revival through warehousing and Rehabilitation) scheme is designed to handle power projects

debt. The AMC approach of handling bad debt was used by different countries for different goals as seen in Mexico (1994), the

Philippines (1981-86), Spain (1977-85), the US (1984-91), Finland (1991-94), Sweden (1991-94), Japan (1991), Korea (1997), China

and Indonesia. Countries such as Norway (1987-93), Argentina (1980-82), Chile (1981-86), Thailand (1997 onwards) and Poland (1992-

95) used creditor-led restructuring method, which India wishes to try. Apart from the “bad bank” approach, another strategy India is
Asset Quality & Risk Management Practices - An Analysis on Yes Bank 4

considering is to change its way of handling loans by creating three buckets - SME loans (less than Rs 50 crore), Mid-sized loans

(ranging from Rs 50 crore to Rs 500 crore) and Large loans (over Rs 500 crores).

LITERATURE REVIEW

One of the earliest studies on non-performing loans (NPL) done on 2,470 US insured commercial banks found that those taking

greater risk tend to make higher losses (Keeton & Morris, 1987). Studies on Taiwanese commercial banks have shown something similar

to what experience in India. For example, the study found that banks with higher government ownership have actually recorded lower

NPLs. It says that bank size is negatively related to NPLs and that larger the size of the bank lesser the NPLs (Hu, Li, & Chiu, 2004).

Another study confirmed that and went on to say that private Taiwan banks are more productive but less efficient in NPL management

compared to public sector banks (PSB) (Liang, Yao, Hwang, & Wu, 2008). But when to comes to Indian NPAs, a study on public and

private sector banks between 2005-06 to 2014-15 found that Indian banks are still not comfortable at NPA management and that HDFC

Bank is better over other banks in the area. The paper went on to make some suggestions to avoid future NPAs and to manage existing

NPAs (Neha, 2016). NPA reduction steps of PSBs appears satisfactory between 1997-2002 but failed for private sector banks, even for

young private sector banks (Mukherjee, 2013).

Both bank-specific and macro factors are responsible for NPLs (Bercoff, Giovanniz., & Grimardx, 2002). Macroeconomic

conditions (such as global economic situation, GDP growth, domestic demand, government policies, real effective exchange rate

(Khemraj & Pasha, 2009)) and financial factors (cost and terms of credit, contract terms, bank size, credit orientation etc.) influenced

NPLs in India (Ranjan & Dhal, Winter 2003). NPAs act as an indicator of credit risk & efficiency of allocation of resources. A continuous

high interest rate period for 18 months has increased NPA levels sharply and this impacted the economy in general and the banks in

particular (Pooja, 2012). Digging deeper, a study found that the percentage of Gross NPA to Gross advances is increasing for public

banks and ratio of Loss Advances to Gross Advances are higher in foreign banks. The Estimated Gross NPA for 2014 is also more in

public banks as compared to private and foreign banks and that Ratio of Gross NPA to Gross Advances for public sector, private Sector

and foreign Banks does not have significant difference between 2009 to 2013 (Mayur Rao & Ankita Patel, 2015).

RBI gave two NPA controlling strategies – Preventive (to prevent from an asset becoming an NPA) and Curative (maximize

recoveries so that banks funds locked up in NPAs are released for recycling) management strategies (Prasad & Veena, 2011). A study

found that bank managers can monitor and improve their asset quality improve their asset quality continuously over time by monitoring

amounts advanced and corresponding NPAs over a periodic basis (Rajveer, Shwetha, & Pradeep, 2012). Statistical studies have proved

that the early warning signs as suggested by RBI, such as Financial, Operational, Banking, Management and External Risks does work

in red flagging the possibility of bank NPAs (Naveenan, July 2016).

Funds that got blocked in GNPAs are huge. A sector-wise analysis of NPAs shows that the proportion of NPAs in percentage

terms for the priority sector loan has been increasing compared to non-priority sector and that asset quality improved considerably by

reducing NPAs with respect to public sector. (Hosmani & Jagadish, 2011).

NEED FOR STUDY

Established in 2004 as a mid-size private bank, Yes Bank is a “full service commercial bank” and has grown up to become the

fourth largest private bank in India. It is the only greenfield bank licence winner in the last two decades from the RBI (institution with

entirely new setup i.e. obtained commercial bank license without any prior exposure to financial business). The bank has best-in-class

NPA numbers and attributes it to its prudent risk management & asset quality functions. Other attributes such as its unique knowledge
Asset Quality & Risk Management Practices - An Analysis on Yes Bank 5

banking initiatives, technology & strategic partnership etc. are studied. Studying these aspects can give us better insights on the

functioning of the bank and can potentially help other banks to pick a que from this thereby keep bad loans under control.

METHODOLOGY

We used Exploratory Research Methodology by collecting secondary data from the bank Quarterly & Annual Reports. (Yes

Bank, 2005-18) and from websites of the bank, RBI and BSEIndia.com. We tried to understand the risk management attributes by

studying how it is practised at the bank. Asset quality numbers are being collected over years and an analysis is done to determine how

they are maintained.

RISK MANAGEMENT

Risk is defined as the exposure to danger, harm or a loss. Banks, being lenders of money, are in the business of managing risk

and need to have a robust risk management system so as to get financial stability and bring value to stakeholders. Risk management is

put into core values of Yes Bank and is top-down and bottom-up driven. Risk is kept in mind at three levels – in doing business (credit

risk, market risk, liquidity risk), in conducting business (operational risk) and zero tolerance risk (compliance risk). It is put into various

processes in the form of filters and processes for early warning signals, by way of communication so that proactive actions are taken

and by regular employee training. While all employees are responsible for managing risk, the accountability is put on the Board of

Directors. The board reviews and approves threshold levels of risk periodically and in accordance to the bank objectives. Various teams

foresee Risk Appetite and Risk Limits so that thresholds are not crossed.

Yes Bank believes that ‘risk management is an art’ and hence gives high importance to board and management architecture

stressing that they have to be given powers and made accountable for risk management. Five Board-level sub-committees look after risk

management and are responsible for framing policies, frameworks and systems. These include: Risk Monitoring Committee (RMC),

Audit Committee (AC), Fraud Monitoring Committee (FMC), Board Committee on Wilful Defaulters & Non-Cooperative Borrowers

and Board Credit Committee (BCC). The culture is such that risk identification, appraisal and appropriate time-bound initiatives to

mitigate risk with the objective to balance risks with returns.

RMC is responsible for preparing policies, frameworks and systems and ensures they are periodically updated. The Chief Risk

Officer (CRO) leads the Credit Risk Unit. Credits are approved by joint delegation and require two or three approvers jointly approving

the proposal. A proprietary model built with the help of a reputed credit rating agency is being followed to carry the appraisal process

which rates customers based on various parameters. Scorecard approach is followed for Retail and SME borrowers. Loan sanction is

done after due diligence adhering to bank credit policy and other regulatory guidelines. Periodic monitoring activity is taken up by a

dedicated team and the ‘Portfolio Analytics Unit’ (PAU) to monitor the loan. PAU provides reports covering various credit quality

indicators, gives early warning signals, identifies portfolio trends and portfolio-level MIS analytics. The market risk systems regularly

conduct stress testing to test Bank’s vulnerability towards extreme situations.

ASSET QUALITY

Bank Asset Quality speaks about its loan portfolio quality and the credit administration processes being followed. This includes

quality of loan, securities and other items such as real estate and other off-balance sheet items. According to RBI Master Circular on

Disclosure in Financial Statements (Reserve Bank of India, 2015), banks need to disclosure their asset quality information under 5 broad

heads. This new reporting standard has forced banks to report data more accurately and give a true and fair picture of the state of affairs

of the bank. We analysed data from the above the quarterly and annual reports of the bank from the above heads and tried to interpret

them.
Asset Quality & Risk Management Practices - An Analysis on Yes Bank 6

GNPA & NNPA STATUS

NPA information is a useful aid in analysing asset quality of a bank, particularly when the information is timely (Meeker &

Gray, 1986). As can be seen from the GNPA and NNPA data, Yes Bank has best in class numbers on both counts.

NPA RATIO

The Net NPA to Advances (Loans given) ratio is a useful metric that speaks about overall quality of a bank’s loan book. The

Net NPA is calculated by subtracting cumulative balance of provisions outstanding at the end of a period from Gross NPAs. In general,

higher NPA Ratio shows increasing bad quality of loans.

NPA Ratio = Net Non-Performing Assets / Loans given

At Yes Bank, the NPA Ratio is contained between 2009 to 2014 but has gradually worsened from 2014 to 2018.

PCR

Provisioning is an RBI prudential regulation norm in which banks have to ‘provision’ (set aside) funds to a prescribed percentage

of their bad assets. The percentage of bad asset that are provided for is called Provisioning Coverage Ratio (PCR). This is a good tool

to determine the extent to which the bank has provided against the troubled part of its loan portfolio. This ratio helps us to determine

relation between current provision balances to the Gross NPA. PCR differs according to the asset quality. When an asset cannot be

recovered, and is lost forever, it will be categorized as a ‘loss assets’ and hence banks have to set aside 100% of such loss assets out of

its profit and if sufficient profits are not there, it eats up the capital impacting capital structure and thereby leading further reparations.

Provisioning Coverage Ratio (PCR) = Cumulative provisions / Gross NPAs

At Yes Bank, PCR has come down from 89% in 2009 to 50% in 2018. The bank says it will strive to maintain PCR > 60% by

March 2019.

CONCENTRATION OF NPAS

One more metric for evaluating bank asset quality is its total exposure to top four NPAs. Contrary to the popular perception,

stress in the banking system is not due to priority sector but restructuring is mostly happening because of large accounts (Mundra,

February 11, 2016). The exposure includes both fund and non-funded exposure. For Yes Bank, the NPA concentration is almost flat till

2014 but has grown exponentially since then and taken a small dip from 2017 to 2018.

DIVERGENCE

RBI felt that banks are under reporting bad loans because banks feel that the loans could be brought into order at a later point of

time during the financial year. In order to bring about transparency and get a true and fair picture about bad loans, RBI issued a circular

on April 18, 2017 insisting that all commercial banks report divergence if the difference between the Bank’s estimate and the RBI

assessment in regard to NPA, Asset Classification, Capital Adequacy Ratio and Provisioning is more than 15%. This data has to be

reported in the subsequent financial report and adequate provisioning be made. This additional reporting is helping banks and RBI to

come to the same commonly agreed numbers in regard to bad loans.

Several banks including Yes Bank, Axis Bank, ICICI Bank and even SBI have reported eyebrow-raising divergence numbers.

Divergence has become so common place in bank financial reporting that a new financial term – ‘Divergence Ratio’ got evolved (Dugal,

2017).
Asset Quality & Risk Management Practices - An Analysis on Yes Bank 7

When questioned, banks are saying the numbers belong to fiscal 2016 and are likely to have got fixed during fiscal 2017. The

statutory audit takes a sample of accounts that the bank provided while the RBI inspection audit takes a random sample. Meanwhile, the

Institute of Chartered Accountants of India (ICAI)’s Financial Reporting Review Board (FRRB) has written to RBI for more

information. The ICAI Disciplinary Directorate said it is ready to take an action if RBI files a complaint. The annual bank audit process

is done by auditors who are empanelled by RBI through ICAI. The banks appoint the auditors from the list sent by RBI. The audit

process is governed by RBI circulars and ICAI guidance notes. The auditors are responsible for full verification of all NPA advances

and certifying various reports including NPA Returns.

Further, if a loan account is a standard asset according to one bank, he would have defaulted with another bank and now RBI

wants even that good account to be treated as an NPA. If FY16, Yes Bank reported Gross NPAs worth Rs 748.9 crore while RBI wanted

to report this at Rs 4,925.6 crore. For FY17, Yes Bank gave Advances of Rs 1,32,262.68 Cr, it reported Gross NPA at Rs 2,018.60 Cr

while the Divergence reported is at Rs 6,355 Cr. The Divergence / Advances is at 4.8% while the Divergence / Gross NPA is at an

alarming 315%! These high divergence gaps have irked investors and so the bank stock experienced a quick downward dip. In regard

to Q2 FY17 data, Rana Kapoor, MD and CEO of Yes Bank said this is “temporary setback on asset quality” and that banks had absorbed

the full impact of the divergence in the second quarter itself. RBI penalized Yes Bank to a tune of Rs. 6 crores for “violations of various

regulations issued by RBI in the assessment of NPAs.” amongst others. Fortunately, for Yes Bank, there were no fresh slippages in

quarter ending March 2018 because as many as 10 of the 19 companies identified in RBI divergence report are being upgraded. Added

to this, the bank is foreseeing very minimal impact on its loans if they are to be taken to NCLT.

Finally, when the bank sought extension of the tenure of Rana Kapoor, RBI rejected it and gave the deadline of February 2019

for the bank to find a suitable successor and industry grapevine is that NPA divergence issue is a strong reason for this (ET NOW, 2018).

Change in top management of the bank adds to uncertainty to its guided strategy.

KNOWLEDGE BANKING

In order to understand customer banking needs better, the bank introduced new and innovative products using its unique

Knowledge Capital & Knowledge Banking concepts. The bank is taking help of domain experts to constantly gathered industry insights

and disseminate it in the form of research reports to its customers. Customers include top corporate houses, emerging corporates and

MSMEs. This focus helped it gain domain knowledge and thereby build sector-specific products to sunrise growth sectors like Food &

Agribusiness, Life-sciences etc. Separate divisions, such as the Food & Agribusiness Strategic Advisory & Research and Government

Strategic Initiatives & Advisory, are formed to work with stakeholders in the respective areas.

SIZE OF BANK

There is mixed empirical evidence in regard to impact of size of bank on NPA. Different studies used different bank size

measurement metrics such as balance sheet size / total assets, capital, bank deposits, market share of the asset or may be on its market

capitalization. Some studies said that larger banks have better risk management strategies and resources and hence will have superior

quality loan portfolio compared to their smaller counterparts (Hu, Li, & Chiu, 2004) (Ranjan & Dhal, Winter 2003) while others said

that large banks are not necessarily effective in screening loans compared to smaller banks (Khemraj & Pasha, 2009).

Yes Bank was established in 2004 and got listed on stock exchanges in May 2005 as a mid-size private bank. In 2014, its balance

sheet size crossed the Rs 1,00,000 crore mark thereby turning it into a large-size bank. As can be seen from the GNPA and NNPA data,

starting 2014, the NPA levels began to show dramatic rise.

Asset Quality & Risk Management Practices - An Analysis on Yes Bank 8

OTHER ATTRIBUTES

Technology advancements helped rapid information exchange allowing banks to implement international best practises.

Extensive use and understanding of technology helped Yes Bank to evolve from a “typical bank that outsources its IT needs” into a

“global banking technology leader”. The bank is a pioneer and a global leader in areas like supply chain financing using Blockchain and

API (Application Program Interface). The bank uses ART of Banking (Alliances & Relationships with underlying Technology).

Together with partners, the bank has introduced innovative features that enhance process efficiencies to mitigate operational risk and

provide sector-specific banking solutions. Its strategic relationships, such as with Agricultural Insurance Company for agriculture

insurance, Max New York Life for life insurance, helped it built platform for mutual benefit.

CONCLUSIONS

The Government of India and the RBI have taken up the task of cleaning up the bank balance sheets on a priority basis. Several

approaches have been used in dealing with loans and the IBC and AMC concepts are major steps towards this. This study felt that

continuous monitoring of risk management, asset quality (GNPA & NNPA status, NPA Ratio, PCR, Concentration of NPAs and

Divergence) and knowledge banking, size of bank and other attributes are actually helping the bank to be with manageable NPA figures.

Volatility in asset quality and larger divergences are a cause of concern and negatively impacted the bank’s stock price.

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