Tuesday, May 27, 2014

RBI proposes new bank insolvency law to increase yields

.........Analysts warned that giving depositors the upper hand over other creditors will have serious implications for bondholders, potentially leading to higher wholesale funding costs for the banks.  "Now that RBI's stand on depositor preference is very clear, we will have to review our support assumptions on debt instruments once the resolution regime comes into force," said Saswata Guha, a director at Fitch Ratings, India. 

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