NEWS
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- Prime Minister is likely to meet chief executives of Indian banks to chalk out a strategy for the banking sector for the next five years.
- The meeting assumes significance as the country’s GDP growth slowed to 5.8% in the January-March 2019 quarter dragging down the full-year growth to a 5-year low of 6.8%.
- Further, the NBFC sector has also slowed down due to which credit flow to productive sectors of the economy has been impacted.
- Recently,the finance ministry has also held discussions with banks on the ongoing crisis in non-banking financial sectors as NBFCs are facing liquidity crunch following the debt default by IL&FS.
- IL&FS is an infrastructure finance company registered with the Reserve Bank of India as a ‘Systemically Important Non-Deposit Accepting Core Investment Company’.IL&FS has run out of money and therefore was unable to service its repayment obligations which led to a series of defaults on loans,debentures and commercial papers.
- Further,the government had recently seen the merger of Dena Bank and Vijaya Bank with Bank of Baroda and also the merger of associate banks of State Bank of India.




