NPLs stand at Rs121bn at Q3 end

LAHORE: The Non Performing Loans (NPLs) of banking industry have been growing and reached Rs121.092 billion in the third quarter ended 31 March 2009 and expected to further increase by the end of this fiscal year.

The recovery of NPLs has declined from Rs12.382 billion in the second quarter of the fiscal to Rs11.540 billion in the third quarter. The declining trend is due to economic recession that has increased the volume of NPLs.

The official data of the central bank shows that the net NPLs stand at Rs121.092 billion in the third quarter of this fiscal registering an increase of 0.43 per cent. The status of net NPLs at half year ended December 31 was Rs114.434 billion and total NPLs were Rs357.028 billion. The percentage of NPLs in the third quarter has grown by 0.43 per cent and standing at 3.96 per cent from half year ended 3.53 per cent.

The banking sector officials commenting on growing portfolio NPLs say it was a matter of concern but not alarming. However, growing NPLs are aggravating the impact of economic recession on job markets. Once a production unit is declared sick the people working there become unemployed. So the NPLs are indirectly adding the impact of economic recession on the employment market.

The data of central banks shows that the NPLs of all commercial banks had grown by 0.33 per cent and reached at Rs106.784 billion from Rs102.928 billion. Though, overall NPLs of the public sector commercial banks have reduced by 0.29 per cent in the third quarter.



To read complete story please visit: http://finance.kalpoint.com