India’s monetary system sound: RBI Governor

Mumbai, July 24

The nation’s monetary system is sound however lenders ought to desist from excessive danger aversion throughout Covid pandemic and past, Reserve Bank Governor Shaktikanta Das stated on Friday.

In the evolving milieu, whereas danger administration needs to be prudent, excessive danger aversion would have adversarial outcomes for all. — Shaktikanta Das, RBI Governor

In his foreword to the bi-annual Financial Stability Report (FSR), Das stated the highest precedence proper now for banks and monetary intermediaries ought to be for augmenting capital ranges and enhance resilience.

“In the evolving milieu, while risk management has to be prudent, extreme risk aversion would have adverse outcomes for all,” Das stated.

The feedback from Das come at a time when credit score progress has declined. “The financial system in India remains sound; nonetheless, in the current environment, the need for financial intermediaries to proactively augment capital and improve their resilience has acquired top priority,” Das stated. Financial sector stability is a prerequisite for giving confidence to companies, buyers and customers, he stated, including “we have to remain extremely watchful and focused”. — PTI

Banks’ dangerous debt to rise sharply: Report

  • Gross NPAs of all banks might soar to 12.5% by the top of this fiscal beneath the baseline state of affairs, from 8.5% in March 2020, in response to the Financial Stability Report (FSR) launched by the RBI
  • Under the ‘very severely stressed scenario’, gross NPAs of banks might improve to 14.7% by March 2021, the report stated

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