Search
Banking system moving from bad to normal
June 14, 2023
The Indian banking system has room to improve further and needs to sustain the healthy profile while ensuring that the current spell of optimism does not turn into irrational exuberance, says N S Vishwanathan, former deputy governor, Reserve Bank of India, and the chairperson of College of Supervisors.
Speaking at the SAS-Business Standard event ‘Risk & Banking Resilience’, Vishwanathan points out that the banking ecosystem in India had moved from “too bad to normal”, supported by regulatory action.
“It is nice that the banking system is in good shape. It is a little early to call it too good because I think it was too bad in the past. What I see is that we are moving from too bad to normal. But this has not happened overnight,” says Vishwanathan.
Steps like the Asset Quality Review (AQR), the Insolvency and Bankruptcy Code, and the provisioning for NPAs (non-performing assets) had made Indian banks more robust and resilient, he explains.
However, cautioning the banks from celebrating too early, the former central bank deputy governor points out the need of sustaining the current resilient structure.
Though a lot of things had been put in place internally and a lot had happened externally, he says sustaining this was important.
Over the years, the provisioning coverage ratio (PCR) of banks has risen to 70-80 per cent, he notes.
Important Links:
- 4-IN-1 Professional Diploma in Banking, Financial Services & Insurance (PDBFSI): https://ask.careers/courses/4-in-1-professional-diploma-in-banking-financial-services-insurance-pdbfsi/
- Mumbai: https://ask.careers/cities/mumbai/
- TSCFM: https://ask.careers/institutes/tscfm/
