The Reserve Bank has said gross non-performing assets in the system shot up to 10.2 per cent as of the September quarter, primarily led by private sector lenders, and has warned that the situation will only aggravate from there, "elevating" the systemic risks. In the half-yearly Financial Stability Report (FSR) put out late this evening, the central bank, however, said the financial system remains "stable" overall though it has pegged the bad loans spiking to 10.8 per cent by the March quarter and to 11.1 per cent by September 2018. "The banking stability indicator (BSI) shows that the risks remain at an elevated level weighed down by further asset quality deterioration," the FSR notes.

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