Interim mechanism to be in place for solving bad loans - Vinod Rai
DSIJ Intelligence / 20 May 2016
Vinod Rai chairman of Bank Board Bureau (BBB) has announced setting up of an interim mechanism to resolve bad loans issue plaguing the PSU Banks. The date set for the same interim mechanism would be June 15.
Vinod Rai chairman of Bank Board Bureau (BBB) has announced setting up of an interim mechanism to resolve bad loans issue plaguing the PSU Banks. The date set for the same interim mechanism would be June 15. Vinod Rai was speaking at Confederation of Indian Industry's (CII's) banking conference.
The problem of NPAs affecting the profitability of PSU banks has become a national issue and if the current Q4 FY16 results are to be considered the profitability of PSU banks on account of large provisioning of bad loans remains a big concern.
Records were broken when Punjab National Bank reported highest loss ever by any Indian Bank in a single quarter, standing at over Rs. 5,300 crores (March quarter). The other PSU banks are also reeling under pressure in terms of profitability.
While reiterating the prioritisation of solving the NPA issue by the government, Mr. Rai confirmed that the banks have already initiated the process of cleaning up their balance sheets, and that RBI will be coming up with guidelines for joint lending.
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