MUMBAI: State Bank of India, facing a “credit discipline” issue in Andhra Pradesh and Telangana following their Governments’ call for farm loan waivers, today said that repayment delays are getting spilled over into poll-bound states as well.

The country’s largest lender said Rs 1,959 crore, or 20 per cent, of its fresh slippages of Rs 9,932 crore in the June quarter came from the farm sector and Andhra Pradesh and adjoining Telangana alone accounted for Rs 600 crore of this.

“We believe it is necessary for people to have credit discipline. We also believe these are two states where there is a lot of potential. Unless they (AP & Telangana) are able to access bank finance, they will not be able to come up to the potential,” SBI Chairperson Arundhati Bhattachrya said.

In Andhra and Telangana, the hit for the bank is not limited to the losses on the agri loans alone. Other loans taken by farmers like for housing and gold are also getting classified as NPAs, she said.

Another hit of Rs 150 crore has come from the home and gold loans side in Andhra Pradesh alone, she added. However, in what may be of concern to the financial system, SBI today said the trend of non-payment is spilling over to other poll-bound states.

“The States that are about to go to the polls are the obvious culprits. Yes, we are seeing some kind of induction effect as we call it.”

Asked specifically if Maharashtra, which otherwise prides itself on development front, is also among the States reporting higher asset quality stress, she countered asking if Maharashtra is not poll-bound.

The Andhra and Telangana Governments had promised farm loan waivers or loan restructuring in the run-up to Assembly elections, citing the impact of cyclone Phailin last year.

RBI Governor Raghuram Rajan had questioned on Tuesday the premise for farm loan waivers, saying there had not been any major crop damage to invite softer regulatory treatment. While in Andhra Pradesh the impact will be to the tune of Rs 87,000 crore if the loan waiver demand is met, in Telangana it will be close to Rs 40,000 crore.