Letters to the editor: Banks responsibility

Updated: Apr 4 2014, 08:36am hrs
Banks responsibility

Apropos of the editorial Banks get a breather (FE, March 29), the onus is now on the banks to introspect why RBI had to postpone the Basel III deadline set for them. NPAs of the PSU banks are increasing and a considerable percentage of the bottom line of the banks is kept for their provisioning. Under-provisioning on toxic loans is also common. The slowdown of the economy pinches the corporates liquidity and lengthened gestation period of the infrastructure projects developed under mega loans of the banks and by the flip flaps of the governments policies all make the stressed assets. At this juncture, postponing the global guidelines on banking is with all rationale. But at the same time it is an enigma that why RBI is granting new licences to applicants which could aggravate the problem further.

NR Nagarajan