SBI: Extra provisioning for stressed telecom sector

The country’s largest lender State Bank of India (SBI) on Saturday reiterated that the telecom sector was under stress and the bank was doing extra provisioning for this. SBI Chairman Arundhati Bhattacharya said the telecom sector was under a lot of stress and the bank was making extra provisions.

The country’s largest lender, State Bank of India (SBI), on Saturday reiterated that the telecom sector was under stress.

SBI Chairman Arundhati Bhattacharya said, “The telecom sector is undergoing a lot of stress and the bank is making extra provisions for this.”

She said this when asked whether the Telecom Regulatory Authority of India’s (Trai’s) decision to reduce the IUC charges would affect incumbent operators, such as Vodafone, Airtel and Idea, which were already feeling the heat of Reliance Jio’s disruptive move.

On the bank’s non-performing assets outlook for the rest of the fiscal year, Bhattacharya said, “We have probably reached the bottom. Slippages are under control although new sectors like telecom were showing stress.”

Bhattacharya, who inaugurated the State Bank Institute of Management at New Town area in Kolkata, said the merger of the associate banks with itself was a deep structural reform.

“Results will come over a period of time. We will deliver them in the next three to four quarters as promised.” Regarding the outlook of the economy after demonetisation and the goods and services tax roll-out, Bhattacharya said the government would have to do some “heavylifting”, like infrastructure development.