The Reserve Bank of India announced Resolution 2.0 expected to help small borrowers survive over the prevailing economic uncertainty, but the trends from the restructuring scheme of the previous year show that retail customers were the ones to benefit greatest from it.

Data released by the banks along with their Q4 results show that loans by retail borrowers ruled the loan restructuring scheme of last year, whereas only a few companies utilized the advantage. Private sector lender HDFC Bank’s total restructuring was for 3.36 lakh accounts, amounting to ₹6,508.37 crores, of which 2.87 lakh accounts were for retail loans amounting to ₹5,456 crores. Similarly, the total restructuring by Axis Bank amounted to ₹844.6 crores, of which retail loans accounted for ₹503.71 crores. Kotak Mahindra Bank restructured loans worth ₹121.5 crores, of which ₹82.38 crores were for retail borrowers. ICICI Bank, YES Bank, and IDBI Bank were among the outliers where the number of corporate loans restructured was higher. In the case of ICICI Bank, the total loan recast was for 1,624 accounts, of which 1,586 were retail accounts and just 30 were corporate accounts. However, in terms of exposure, retail loan restructuring amounted to ₹643.19 crores, while corporate loan recasts were higher at ₹1,323.28 crores. For YES Bank, the number of accounts, as well as exposure to corporate loans under the recast scheme, were higher compared to retail accounts and loans. Of the total loan recast of ₹1,112.21 crores by YES Bank, corporate loans accounted for 352 accounts valued at ₹940.11 crores.

However, the overall restructuring of loans was low for most private sector banks and they have already made sufficient provisions. In a note, Emkay Global Financial Services said that they noted that the bulk of slippages in 2020-21 has come from retail and MSMEs. The higher restructuring was also availed by both these segments. Among banks, large ones have seen sub-1 percent restructuring of loans, while mid-size private banks and small finance banks have seen higher loan restructuring. More data will be available on the restructuring trends once public sector lenders also announce their Q4 results.