{"id":35255,"date":"2018-10-31T16:00:40","date_gmt":"2018-10-31T10:30:40","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=35255"},"modified":"2018-10-31T16:00:40","modified_gmt":"2018-10-31T10:30:40","slug":"must-restore-banks-health-in-months-if-not-weeks-rbi","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/must-restore-banks-health-in-months-if-not-weeks-rbi\/","title":{"rendered":"Must restore banks\u2019 health in months, if not weeks: RBI:\u00a0"},"content":{"rendered":"<p><a href=\"http:\/\/www.thehindu.com\/todays-paper\/tp-business\/must-restore-banks-health-in-months-if-not-weeks-rbi\/article19639671.ece\">Must restore banks\u2019 health in months, if not weeks: RBI<\/a>:<\/p>\n<p><strong>Context<\/strong><\/p>\n<ul>\n<li>Reserve Bank of India\u2019s deputy governor Viral Acharya said a feasible plan was quickly needed to address the massive recapitalization requirements of public sector banks.<\/li>\n<\/ul>\n<p><strong>What is the need of the plan?<\/strong><\/p>\n<ul>\n<li>The central bank has been trying to restore the condition of these banks in order to facilitate loan offtake, seen as essential in reviving economic growth.<\/li>\n<\/ul>\n<p><strong>Need to raise capital<\/strong><\/p>\n<ul>\n<li>It is the heat of the moment and banks are not raising capital at a time when plenty of liquidity was chasing stock markets.<\/li>\n<\/ul>\n<p><strong>The Indradhanush plan<\/strong><\/p>\n<ul>\n<li>In 2014, the government announced the Indradhanush plan \u2014 a blueprint to revive public sector banks, which included capital infusion in these banks over a four-year period<\/li>\n<li>The Indradhanush was a good plan, but not powerful enough.<\/li>\n<li>we need a much more powerful plan<\/li>\n<\/ul>\n<p><strong>What next then?<\/strong><\/p>\n<ul>\n<li>A Sudarshan Chakra aimed swiftly, within months if not weeks, restoring public sector bank health, with the current ownership structure or otherwise.<\/li>\n<\/ul>\n<p><strong>The contemplating question<\/strong><\/p>\n<ul>\n<li>Whether bringing down government\u2019s stake in these banks to 52% was sufficient to restore health, as some of them had incurred huge losses remains a big question.<\/li>\n<\/ul>\n<p><strong>On Insolvency and Bankruptcy Code (IBC)<\/strong><\/p>\n<ul>\n<li>Banks should not wait for directions to pursue bankruptcy proceedings in the case of defaulting clients.<\/li>\n<li>RBI has twice directed banks to start insolvency and bankruptcy proceedings against defaulting firms.<\/li>\n<li>The reason behind mandating a higher provision for accounts brought under the IBC was to \u201cincrease banks\u2019 provision coverage ratio.<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Must restore banks\u2019 health in months, if not weeks: RBI: Context Reserve Bank of India\u2019s deputy governor Viral Acharya said a feasible plan was quickly needed to address the massive recapitalization requirements of public sector banks. What is the need of the plan? The central bank has been trying to restore the condition of these&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/must-restore-banks-health-in-months-if-not-weeks-rbi\/\">Continue reading <span class=\"screen-reader-text\">Must restore banks\u2019 health in months, if not weeks: RBI:\u00a0<\/span><\/a><\/p>\n","protected":false},"author":61,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[555],"tags":[],"class_list":["post-35255","post","type-post","status-publish","format-standard","hentry","category-test-1","entry"],"jetpack_featured_media_url":"","views":{"total":0,"cached_at":"","cached_date":1704601876},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/35255","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/61"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=35255"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/35255\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=35255"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=35255"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=35255"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}