Question
What was revealed in the audit by Reserve Bank Of India ?
Read the following passage carefully and answer the questions given below them. Certain words/phrases have been printed in bold to help you locate them while answering some of the questions. If the financial performance of India’s largest lender is anything to go by, an end to the severe bad loans crisis may be much farther beyond the horizon than previously anticipated. For the first time in almost 19 years, the State Bank of India reported a quarterly loss of ₹2,416 crore for the three months ended December, compared with a net profit of ₹2,610 crore in the year-earlier period. While the figures are not strictly comparable after SBI completed merger with its associates, the loss was the result of both a massive increase in provisions to account for bad loans and a substantial amount of mark-to-market losses on its holding of government bonds. Provisions for non-performing assets (NPAs) more than doubled to about ₹17,760 crore, from about ₹7,200 crore in the third quarter of 2016-17. On treasury operations, SBI recorded a loss of about ₹3,255 crore, versus a profit of about ₹4,776 crore in the comparable period. The bank revealed that an audit by the Reserve Bank of India showed a divergence of ₹23,239 crore in the way it classified assets at the end of the last financial year, which led to increase in provisions in the last quarter. Most of these reclassified assets are linked to troubled projects in sectors including power and telecom. SBI, of course, is not the only lender to have had its assets forcibly reclassified by the RBI. Private sector lenders have also been found guilty of pushing troubled assets under the carpet until the RBI called their bluff .
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