'Important to deal with non-performing assets'
India, July 30 -- My interpretation of his remarks is that we might have to encounter scenarios of stress which far exceed the usual standards of Basel capital requirements. Implicitly what he was suggesting was that the hit of a prolonged lock down on bank loans of individual and MSMEs might far exceed traditional losses. The latest Financial Stability Report endorses his remarks. The Non Performing Assets (NPAs) to advances ratio is far in excess of what we have ever seen. With the GDP set to contract anywhere between 5% and 10%, some analysts believe that the NPA ratio could end up even higher. I think there is still time. I am hoping that the RBI will use some of these estimates to get both public sector and private sector banks to shor...
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