The CII - IBA Financial Conditions Index for Q1 FY 2020-21 recorded a steep drop to below 50 mark for the first time in the past few quarters owing to the expectation of deterioration in the overall financial conditions in the economy on account of worsening funding liquidity, external financial linkages and economic activity index. However, respondents are quite optimistic with respect to the availability of funds at a lower cost.
This fall is primarily due to the outbreak of the COVID-19 pandemic which has sent economies and financial sector across the world into a meltdown.
A total of 22 entities participated in the Survey which includes 09 Public Sector Banks, 05 Private Sector Banks, 02 Foreign Banks, and 01 Cooperative Bank. Representing other financial institutions, 05 leading NBFCs participated in the Survey.