RBI gov­er­nor steps in to calm nerves

Hindustan Times ST (Mumbai) - HT Navi Mumbai Live - - FRONT PAGE - HT Correspondent ht­metro@hin­dus­tan­times.com

MUM­BAI: Re­serve Bank of In­dia (RBI) gov­er­nor Raghu­ram Ra­jan said on Thurs­day that the cen­tral bank and the govern­ment were de­ter­mined to tidy up In­dia’s prob­lem of mount­ing bad loans by the next year but cau­tioned the so­lu­tion might in­volve “deep surgery”.

“Our in­tent is to have clean and fully pro­vi­sioned bank bal­ance sheets by March 2017,” Ra­jan told a gath­er­ing of top bankers and busi­ness ex­ecu- tives in a meet­ing or­gan­ised by the Con­fed­er­a­tion of In­dian In­dus­try (CII).

Ra­jan’s com­ments came on a day when In­dia’s stock mar­kets fell by over 3%, ham­mered by poor fi­nan­cial earn­ings of State Bank of In­dia (SBI), the coun­try’s largest len­der. He said banks could ei­ther ap­ply “band aids” and hope for projects to get back on track. “An al­ter­na­tive ap­proach is to try to put the stressed pro­ject back on track rather than sim­ply ap­ply­ing band aids. This may re­quire deep surgery,” the RBI gov­er­nor said.



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