Gupta’s ‘House of Debt’ report on NPAs in 2012 prompted India's policy makers to revise the country's official bad loan ratio from 3 percent to 9.3 percent, which was among the highest in the world.
The man who first uncovered the extent of non-performing assets (NPAs) in the Indian banking industry in 2012, has quit. Ashish Gupta, head of India equity research at Credit Suisse — known for his work on the ‘House of Debt’ report on NPAs in 2012 — has resigned, according to CNBC-TV18. The report had stated that the borrowings of 10 corporate groups in the country is equivalent to 13 percent of bank loans and 98 percent of the banking system's net worth.
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The report had maintained a cautious stance on the corporate asset quality outlook for the banking sector and also maintained their underweight stance on the same.
Among the groups highlighted in that report were Adani Enterprises, the Essar Group, GMR Group, GVK Group, Jaypee Group, JSW Group, Lanco Group, the Videocon Group, among others. Companies within most of these groups went on to enter the corporate insolvency process in the future. Litigations for some are still ongoing.
The report created a furore among India's policy makers, who, on reviewing the books of Indian banks, revised the country's official bad loan ratio from 3 percent to 9.3 percent, which was among the highest in the world.
In an interview with CNBC-TV18 last year, Gupta spoke about India's financial landscape and the banking sector. He also spoke of fintechs, who are now challengers and collaborators to the existing banks. He went on to say that the advent of new technology always goes on to hurt the incumbents.