Banks need to closely monitor asset quality, prepare for higher provisioning: RBI

Reserve Bank of India (RBI) on Thursday asked banks to closely monitor their bad loans and prepare themselves for higher provisioning in the wake of second COVID wave and the Supreme Court order lifting the ban on classification of non-performing assets. The waiver of compound interest on all loan accounts which opted for moratorium during March-August 2020 may put stress on banks' financial health.

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