Private sector banks have seen higher declines in their retail portfolio as per their financial first quarter results, as restructured loans continued to slip into the bad loan category during the COVID period. Top banks, including contributions from micro-loans, credit cards and vehicle loans, reported higher declines in retail ledgers, but said there was no cause for concern.

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While there is no breakup of data on slippage, PSBs whose numbers ET looked at did not show such trends. ICICI Bank reported a decline of Rs 5,037 crore in retail loans, including rural and business banking loans, in the June quarter, as compared to Rs 788 crore for corporate and SME loans.

However, on the positive side, the bank upgraded a large part of the loans and said it was not worried about high slippages, which stood at Rs 3,736 crore for retail loans in the March quarter. “We added about Rs 5,000 crore (of retail slippage) to this, and also an upgrade of Rs 4,000 crore, which happened at the same time,” said ICICI Bank executive director. Sandeep Batra Said during the call after earnings.

“And that includes rural, which was unprecedented as we explained looking at the billing cycle, slightly higher levels during this current quarter. But if you look at the aggregate, the amount we are talking about is very less and we are making adequate provisions against that. The worst part is that we still have a contingency provision of Rs 8,000 crore. So, it doesn’t really concern us at all.”

At IndusInd Bank, a major chunk of the total drop of Rs 2,250 crore came from the microfinance segment. Loans from the MFI segment of Rs 1,024 crore were part of the bad loan category, while commercial vehicle loans were another major contributor with bad loans of Rs 486 crore. “The gross inflow from the standard book (for NPAs) has come down, the addition (for bad loans) from the restructured book is because of the MFI clause, we have made 100% provisions against that,”

Managing Director Sumant Kathpalia Told.