Stressed borrowers Banks are now seeing the full extent of borrower stress with a one-time debt restructuring facility and the Supreme Court's standstill on NPA recognition no longer available. The nation's top court allowed banks to resume classifying bad loans as NPAs in March, reversing an order from Sept. 30, 2020, when it had stopped lenders from declaring any new bad loans in an effort to give borrowers more time to repay. "In the absence of regulatory measures such as moratorium, the gross NPA formation due to the recent wave of COVID-19 is being upfronted in the first half of the current fiscal [year] for the system, including us," said Sandeep Bakhshi, CEO of ICICI Bank, during a July 24 earnings call. Bakhshi expects the bank's gross NPA additions to be lower in the second quarter and "decline more meaningfully in the second half of fiscal 2022," based on expectations of economic activity.