NPAs and its effects on banks’ profitability December 22, 2020, 12:11 PM IST
Abhishek Sikdar graduated in Economics from St Xavier s College under Calcutta University and post-graduation from Delhi School of Economics. He has worked in several leading business newspapers. During his service career, he had written numerous reports, conducted meetings with global economic consultants and international fund managers and imparted training programs to Sales Teams. LESS. MORE
Introduction
The Indian economic crisis of 1990s fuelled the need of World Bank and IMF loans which led to the remodeling of the banking system in India along with the economic liberalization policies of 1991 in the ways of the Narsimham Committee reforms.
Need Multiple Bad Banks to Address NPA Issue, CII Tells Govt
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The Confederation of Indian Industry (CII) has urged the government to consider creation of multiple bad banks to address the adverse impact of non-performing assets accumulated by public sector banks in the recent past, and which have got further accentuated during the pandemic.
In its pre-budget memorandum submitted to the government, the industry body has recommended the government to consider enabling Foreign Portfolio Investors (FPIs) and Alternative Investment Funds (AIFs) to purchase NPAs.
CII President Uday Kotak said: In the aftermath of Covid, it is important to find a resolution mechanism through a market determined price discovery. With huge liquidity, both globally and domestically multiple bad banks can address this issue in a transparent manner and get the credit cycle back in action.
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