Write off of loans benefit the borrowers,banks and their connections whereas, recovery results in loss to all these parties. The recoveries are to be shown in banks books as profit and these have to be shared among all stakeholders of banks and there are no personal gains. Write off of loans have personal gains and the loss is passed on to all stakeholders of banks starting from depositors. Poor tax payers also share the loss is perhaps not known to many and hence the write off of loans is not generally subjected to any detailed scrutiny. It is easy to loot the banks through managed write offs and this has been going on for decades unquestioned.
Dr.T.V.Gopalakrishnan
(This comment appeared in Business standard against the write up Public Sector Lenders write off loans more than the cash discovery on 22/3/14)
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