Letter to BS: Disclosures of delinquencies may affect goodwill of borrowers

Real-time disclosures of delinquencies would affect the goodwill of borrowers and lenders. A framework that mandates daily compliance reporting on defaults doesn't go well with the concept of an inefficient market. The regulations must be enforced on a case-basis. Credit history of borrowers, overall lending discipline by creditors, amount at stake, need for the immediate disclosure, possibility of awarding a grace period and impact of the default are aspects that ought to be considered. Although the initiative can promote market transparency, it has a shorter horizon and is reactive in nature. The non-performing asset situation can be be prevented in