MUMBAI : State Bank of India is looking at creating a software-driven early warning system to help it identify potential stressed assets or problem loans and is scouting for a technology partner to develop and implement this, senior bank officials told Cogencis.
SBI has already begun the process for this, and aims to select a technology partner by early February.
“SBI is looking for a system that will throw up these early signals that will help identify stress in loan accounts at the incipient stage enabling the bank to take steps to resolve, recast or even take higher collateral, if the situation so demands,” a senior bank official said.
Soundara Kumar, deputy managing director- stressed assets management at SBI, on Dec 17 had said that an early warning system that could be implemented by banks could help to prevent some of the slippages.
On Dec 17, RBI, in its discussion paper had suggested creation of a new sub-set asset category called ‘special mention accounts’, for loan accounts that have shown early signs of stress, but are yet to turn into non-performing accounts. -Cogencis