RBI Deputy Governor Subir Gokarn is not worried about the state of Indian banking system. He believes there is no systemic weakness in India banks, even though non-performing assets are rising due to the gloomy economic environment. The system, as whole, is secured stated Gokarn reacting to the recent downgrade of the Indian banking system by global agency Moody's. "I cannot make a judgement on what a rating agency does. I can neither endorse their views nor I can challenge. Every six months, we come out with financial stability. In that exercise, there is great deal of stress testing," he told reporters on the sidelines of a conference held here in Mumbai. Last week, Moody's lowered its outlook for the Indian banking system from 'stable' to 'negative' on concerns of a possible rise in bad loans, capital infusions and profitability. "We are not targeting any specific rate. We intervene only when there is very strong volatility in a particular direction. It (currency volatility) is now happening globally," the Deputy Governor said.Meanwhile, bankers rubbished some industry rumours suggesting that the finance ministry has asked state-owned banks not to get ratings from ICRA, an associate rating agency of Moody's operating in India. "We have not received any instruction from the finance ministry in this respect. The ministry normally does not pass on this type of intimation," M V Nair, CMD, Union Bank of India told Moneycontrol.com.
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