The non-performing assets (NPAs) or bad loans of the banking sector soared from 0.97 per cent to 1.28 per cent in the financial year of 2011-12, according to the newly published RBI report.

It its latest report, titled "The Profile of Banks: 2011-12," the central bank said that high interest rates and slowdown in the economy pushed the banking sector's NPAs drastically up.

The NPA for state-owned State Bank of India (SBI) and its associates jumped to from 1.49 per cent in 2010-11 to 1.76 per cent in 2011-12. In the first three months of the current financial year, net NPA of SBI jumped from 1.61 per cent to 2.22 per cent year-on-year.

The public sector lenders' aggregate NPA level jumped to 1.53 per cent, from 1.09 in the previous year.

Commenting on the figures, a senior executive from a public sector lender, said, "The overall economy is slowing down and the cash flows of corporates have been affected which has had cascading effect on NPA levels."

But, private sector banks managed to slash their NPAs from 0.56 per cent in 2010-11 to 0.46 per cent in 2011-12.

Likewise, foreign sector lenders also managed to reduce their NPAs to 0.61 per cent in 2011-12, down from 0.67 per cent in the previous year.