MUNDRA-NPAS2LST(BCM30)

Foreign banks’ profitability slightly declined to Rs Foreign banks’ profitability slightly declined to Rs12,619 crore in March from 12,764 crore last year. "To be fair to the sector, some of the events wereexternal and hence not in control of the bank management,"Mundra said. Provisions for bad loans soared 131 per cent to Rs1,70,630 crore during 2015-16 from Rs 73,887 crore in 2014-15. State-run banks’ provisions for bad loans jumped 150 percent to Rs 1,44,608 crore from Rs 57,842 crore. Mundra said the recent performance of the banking sectorhas taught an unambiguous lessons that in the absence ofstrong structural and governance reforms, consistency of theperformance would always remain susceptible to such events. "There is a need for structural and governance reforms,"he said, adding for the private sector banks such reforms haveto be focused on misaligned incentives and compensation. PTIHV BEN NPABKJMF