Banks' non-performing assets: Where have all the risk managers gone?

When we now talk about stressed loans of more than Rs 10 trillion, the 10 years from 2004 to 2014 become important, for this was the period when these loans were sanctioned and disbursed

The government decision between 2004 and 2009 to award captive coal mines for power projects unleashed the Indian corporate entities’ animal spirit. And, the demand for long-term project loans zoomed.

When bankers and analysts now talk about stressed loans of more than Rs 10 trillion, the 10 years from 2004 to 2014 become important. For, this is the period when these loans were sanctioned and disbursed. The period after the global credit crisis of 2008 is of particular importance.

According to a February 2017 speech by RBI Deputy Governor Viral Acharya, stressed assets accumulated because of “excessive bank lending, en