MUMBAI - Singapore regulators have stepped up their scrutiny of some local branches of Indian banks on concerns about asset quality, three bank executives told Reuters.
India's slowest economic growth in a decade and a weakened rupee have weighed on the balance sheets of heavily leveraged Indian companies, including those that have raised money from Indian lenders in offshore centres such as Singapore.
The Monetary Authority of Singapore (MAS) is looking more closely at the books of the local operations of some Indian banks to assess the credit quality of loans made from the branches to Indian companies, bankers said.
"There is an enhanced degree of oversight by the Monetary Authority of Singapore on Indian Banks in the recent days," SS Mundra, chairman and managing director of state-run Bank of Baroda, told Reuters.
"They are closely keeping a tab on the NPA (non-performing asset) levels and looking at the quality of assets financed."
An MAS spokesman said it "does not comment on our dealings with individual financial institutions"
The regulator has in some cases suggested that banks re-classify some loans as non-performing assets, two bankers said, speaking on condition of anonymity.