Loan moratorium case: Adverse SC verdict could heavily affect banks in Q2

Topics loans | Supreme Court | Banks

The highly anticipated Supreme Court (SC) hearing on ‘interest on interest’ for loans under moratorium is scheduled for next Monday. A back-of-the-envelope calculation indicates that banks are staring at a Rs 10,000-20,000 crore hit on their profit and loss statement if the verdict is unfavourable.   While this is about two per cent of total banking sector loans, analysts at Motilal Oswal Securities (MOSL) estimate that banks’ operating profits could take a 24-111 per cent hit in financial year 2020-21 (FY21). If a final verdict is delivered on Monday and is unfavourab.....

Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel
Key stories on business-standard.com are available to premium subscribers only.

Already a premium subscriber?

Subscribe to get an across device (Website, Mobile Web, Iphone, Ipad, and Android Phone applications) access to Premium content, Breaking News alerts, Industry Newsletters, Stock and Corporate news alerts, access to Archives and a lot more.