Axis Bank in their conference call yesterday indicated that provisions will be increased due to the coronavirus. They also expect that there could be some impact on extent of loan growth.

Amitabh Chaudhry, MD and CEO of Axis Bank spoke about the impact on credit cost and guidance on asset quality in an interview with CNBC-TV18. “With economic activity slowing down, we will see increase in this profile across assets of all kinds from wholesale to SME to retail. India has had a great retail run for a long period of time but if people are not going to work, people will be out of jobs, especially the casual labour. We do expect that the ability of the people to repay will get hampered and so you could see an impact on the retail assets,” he said.

“As of day before yesterday, we have had absolutely no problem in any of our collections, any data which seems to indicate that delinquencies are on the rise but when we look around what is happening in the market and the economy, we know that the likelihood of increase in delinquencies is going to be high and we have to be prepared for it," he said.

"At this time, it is also very important to ensure that you manage your costs well. It is also very important to conserve the capital and important to ensure that you have enough liquidity so that we can serve our customers properly. We need to ensure that our ATM machines are well stocked. All of us are very focused on ensuring that the financial services are provided to our customers,” he emphasized.

“This quarter is almost over. Over the last couple of days as economic activity has come to a grinding halt, it will impact next 5-7 days but otherwise the quarter is pretty much done for almost all the industries across India and the same applies to the financial services sector. It is all about what will happen in the next quarter and what the impact of this would be in the next quarter as we move forward,” said Chaudhry.

Talking about his expectations from the government, he said, "I do believe that government needs to come out with some kind of package and infuse some real cash in the economy otherwise we will have a major problem in our hands."

"I am sure Prime Minister Narendra Modi and the Reserve Bank of India (RBI) are working on something, hopefully they will announce it sooner than later because as the time goes by, the effectiveness of what they will announce reduces quite rapidly. We are all waiting with baited breath for the announcements on what is possible and what they intend to do," he said, adding that one of the suggestions has been that the government should intervene in the markets directly, as it happened in the global markets, government has bought equity. Government has bought corporate bonds, through RBI or directly and I think something like that would support the market in the long-term and government can end up making some money because the way prices are moving in both the equity and the bond markets, I think at one level it looks like a great buy.”