Apropos of the editorial “Bank on trouble” (FE, February 4), no business is without risks and banks are no exception to that. NPAs within the limit are natural but a high level of NPAs is bound to cause concern. Few banks, especially by virtue of having a high exposure to sensitive sectors like power, realty, etc, are faced with high degree of NPAs. The reasons for more loans turning non-performing in the recent times are many. Interestingly, Indian banks today have a well-defined risk management profile in place to anticipate the risks. The immediate priority should be to bring interest rates down. RBI, in its policy round up, has indicated that the need of the hour is to address the supply-side constraints. External shocks are bound to be there in the globalised economy and banks must now learn to live with those.
- Srinivasan Umashankar, Nagpur (FE)
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