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Bank failures: When it comes to regulation West can learn plenty from India

The West can learn from India the art of keeping a balance between the asset and liabilities sides. But it won't

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T C A Srinivasa-Raghavan
Bank failures are in the news again but fortunately not in India. In fact, Indian banks have been pretty ok despite the huge bad loan problem. This has prompted even the prime minister to say we have nothing to worry about.

This wasn't always the case. Until the early 1960s, Indian banks used to fail as frequently as anywhere else in the world. Free entry and exit were the order of the day. The depositors had no say because the caveat emptor – buyer beware -- rule prevailed. Banks kept failing. You name a bad practice, and it was there.
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First Published: Mar 23 2023 | 9:34 AM IST

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