Business Standard

Letter to BS: Weak financial institutions need operational reforms

NPAs are under-capitalised and the banks are restrained by the prompt corrective action framework as they do not meet the stipulated regulatory financial parameters

recapitalisation
Premium

Illustration

Business Standard
This refers to “If PSBs can’t lend, they should be privatised” (June 29). It seems Niranjan Hiranandani’s (pictured) panacea for lack of public sector banks (PSBs) lending is the privatisation of PSBs. The PSBs are not lending because their earlier reckless lending has turned into non-performing assets (NPAs). These NPAs are under-capitalised and the banks are restrained by the prompt corrective action framework as they do not meet the stipulated regulatory financial parameters. He says that “excessive funds lying with banks should be disbursed in the market”. Banks are in the business of financial intermediation that is, prudent lending, so
Topics : PSBs NBFCs

Don't miss the most important news and views of the day. Get them on our Telegram channel

First Published: Jun 30 2019 | 9:07 PM IST

Explore News

To read the full story, subscribe to BS Premium now, at just Rs 249/ month.

Key stories on business-standard.com are available only to BS Premium subscribers.

Register to read more on Business-Standard.com