Banking institution play vital role in economy but in the recent days banking are in worst situation since growth rate of economy has impacted. Since this opportunity to regulate and strengthen the banking institution.
Relaxing the Norm under Prompt corrective Action: It will increase the capacity of lending and boost boost the economic activity.Separate measure to deal with NPA and wilful defaulter .Fixing base price for bidding of assets: To avoid large haircut and timely resolution fixing a floor price will affect price discovery and discourage bidders.
Lack of resource base and expertise in dealing with long term financial project since architecture of new financial need to design and specialized institution need to appointed.Conflict of power between RBI and center and other stakeholder since constitution high power committee is must.
Relaxing capital adequacy norms, particularly for weaker banks, could be risky and affect financial stability. Separate treatment for NPA will lead more complication and unnecessary separate body.
Insolvency and bankruptcy is still new stage to deal with large valume of debt.
More focusing on National Company Law Tribunal to deal NPA problem.Creating Bad bank and Assets Reconcilation company can be alternate option.More regulation and independency need to operationalised system. Appointment of expertise in bank board is necessary.
Banking institution play crusial role in Indian economy and this is right time to take appropriate measue to revive the growth rate of economy.
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