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A Bad Bank Wonât Work Without A Good Design: Why Government Must Own Most Of It
by R Jagannathan - Feb 3, 2021 05:09 AM
Finance Minister Nirmala Sitharaman.
A bad bank will function sub-optimally if the government does not own it substantially.
Government ownership of the bad bank is a better idea than expecting banks themselves to carry the can with their own money.
The Finance Minister has proposed the setting up of a âbad bankâ to take over a chunk of stressed assets in the banking system so that (mostly) public sector banks can clean up their balance-sheets.
In her budget speech last Monday, Nirmala Sitharaman said: âThe high level of provisioning by public sector banks of their stressed assets calls for measures to clean up the bank books. An Asset Reconstruction Company Limited and Asset Management Company would be set up to consolidate and take over the existing stressed debt and then manage and dispose of the assets to Alternate Investment Funds and
Union Budget 2021: FM gives major focus to infra, health; to boost economy through multiplier effect While the high fiscal deficit would not be credit positive for international credit agencies, in the current environment, it would have been impossible to push the growth without fiscal destabilization in the short to medium term Arun Singh February 03, 2021 20:09:07 IST Union finance minister Nirmala Sitharaman. Image courtesy CNBC-TV18
This Union Budget has been very pragmatic and positive. Even as the Budget misses the expectation of being unconventional, multiple unique initiatives have been announced such as fintech hub, gold exchanges, digital census etc. The big thrust on infrastructure and healthcare sets a positive story. This will boost the economy through the multiplier effect and helping other ancillary sectors and create jobs rather than what di
Centre Bleeding Dry Public Sector Banks: P Chidambaram Rips Into Budget Centre Bleeding Dry Public Sector Banks: P Chidambaram Rips Into Budget While presenting the Union budget today, finance minister Nirmala Sitharaman had spoken of stressed asset resolution
P Chidambaram also ripped into the special outlay for poll-bound states.
New Delhi:
Senior Congress leader and former finance minister P Chidambaram criticised the 2021 budget today on several counts, including special outlays for election-bound states and the measures announced for the Public Sector Banks or PSBs. The intent of the government is clear to let the PSBs bleed slowly so that they can be privatized, he said.