The bankruptcy code does not guarantee efficient resolution

RBI has been commended for acting to refer big-ticket firms for resolution under the code

The Insolvency and Bankruptcy Code has been variously credited as being “game-changing”, “excellent” and as being able to “save the lenders” since its enactment. It will face its first real test now that the Reserve Bank of India (RBI), acting on powers recently conferred upon it, has drawn up a list of 12 borrowers for banks to resolve under the bankruptcy code.

However, it is important to remind ourselves of the structural issues with the public sector banks that led to the non-performing assets (NPAs) crisis in the first place.

The lack of human capital in the public sector to