Small banks have much impact of 2nd wave of Covid on asset quality

Small Finance Banks in India are expected to face a broad delinquencies across loan portfolio amid the turmoil caused by the second wave of the present pandemic situation of corona virus. The situation is even more challenging for all the Small Finance Firms which includes the microfinance institutions. These institutions were struggling for finding financial support. Their borrowers were to be hold back the repayments for the present pandemic situation.
These banks were managed by the Reserve Bank of India, for the financial supports by serving some sections of the business and that were in relation with the Small Marginal Farmers and micro and Small Industries.
Some of the Small Finance Banks which also made aggressive lending in the part of two quarters.

The AU Small Finance Bank set aside a small contingent provisions of 70 crores at the end of the March Quarter. Equities Small finance Bank, the most conservative among the Small Finance Banks, saw a decline in all provisions in selection with the last year. The Banks were made an additional provisional of only ₹ 153 crore at the end of the March Quarter.

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