New Delhi, Aug. 22 -- The gross non-performing assets (NPAs) of banks fell sharply in the first quarter of FY26, reflecting an improvement in overall asset quality, according to a report by Care Edge Ratings.

The report said that the gross NPA (GNPA) ratio also showed an improvement, falling to 2.3 per cent in Q1FY26 compared to 2.7 per cent a year ago.

It said "GNPA reduced by 9.5 per cent year-on-year (y-o-y) to Rs 4.18 lakh crore as of Q1FY26".

On the other hand, the net non-performing asset (NNPA) ratio remained stable at 0.5 per cent in Q1FY26 for the second consecutive quarter, against 0.6 per cent over a year ago. In absolute terms, NNPAs reduced by 8.7 per cent y-o-y to Rs 0.92 lakh crore as of the quarter.

However, sequential...