Reserve Bank of India (RBI) governor Raghuram Rajan and other senior central bank officials on Monday met chiefs of public and private sector banks to discuss asset quality and the cleaning up of bank balance sheets.
The meeting was chaired by Rajan, while RBI deputy governors R Gandhi and S S Mundra were present along with other senior officials from banking regulation and supervision departments. Bankers including SBI chairman Arundhati Bhattacharya, ICICI Bank MD & CEO Chanda Kochhar, Axis Bank MD & CEO Shikha Sharma, IDBI Bank MD & CEO Kishor Kharat, Union Bank CMD Arun Tiwari attended the meeting.
Bhattacharya said that the discussion was purely on general terms and the discussions will continue. “The RBI governor has already stated in the monetary policy that he would like to take steps to further strengthen balance sheets of banks,” she said, adding that basically it was the discussion on what steps should be taken, what will the economy be like going forward, and therefore what steps need to be taken to face those challenges.
Later, RBI said in a statement that the central bank and bankers discussed various issues including the asset quality of banks and the way forward on improving the quality of bank balance sheets.
Rajan had said recently that the central bank would want to put something like March 2017 on the table by when clean-up would have to be done. “This is an ongoing process and my hope is as the banks recognise more of what needs to recognised and they deal with the stressed assets,” he had said.
While most bankers were tight-lipped after the meeting, only a few spoke to reporters, but said the discussion was not on any specific issue plaguing the sector, but a general one on the economy.
Arun Tiwari of Union Bank said, “This meeting did not have any specific agenda and was purely for bankers’ feedback on general economy, commodity prices, capital raising plans and so on.”