Instead of creating Bad Bank, govt should help PSBs resolve their NPAs

Otherwise, the government would be party to the exceptionalism of Indian PSBs and taxpayers would continue to pay for the lack of due diligence in assessing credit risk in recovering huge unpaid debts

Banks, NPA, IBC
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Illustration by Binay Sinha

Jaimini Bhagwati New Delhi
Higher lending for long-term investments in India would obviously nudge growth upwards. At end-March 2010 and 2011 growth in lending for public sector banks (PSBs) was booming at 19.9 and 21.5 per cent (year-on-year) and for private banks the comparable numbers were 12.9 and 23.9. By March 2017 credit growth for PSBs was down to 1.5 and has recovered somewhat to about 5 per cent by March 2018. For private banks, the same numbers for 2017 and 2018 were 17.3 and 22 per cent (Source: RBI Financial Stability Report released on June 26, 2018). However, the outstanding stock of private
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First Published: Jun 29 2018 | 5:55 AM IST

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