The banking sector which was doing well has lost its stamina and strength because of deteriorating quality of assets,particularly advances. The casual approach to credit portfolio management ignoring, the standards of appraisal,close monitoring of borrowal accounts and write off of loans etc has induced many to avail of loans and hoodwink the banks. The economic slow down has also been taken advantage of by many a borrower to default the loans. The Board also is a party to loosen the grip and provide loans to whom so ever it wants to please. The present approach of RBI is also to help the bad borrowers to take shelter under restructuring and float as Standard assets at the cost of banks profitability.The healthy balance sheets of banks is essential to a healthy economy has been getting continuously ignored by all stakeholders Viz, RBI, Government, Banks and their investors, depositors and employees. Auditors and bad borrowers enjoy the loss of the said stake holders and finally, the entire burden is passed on to tax payers who include Financially excluded masses.
Dr.T.V.Gopalakrishnan
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