| With the decision to issue licences to two of the twenty five applicants RBI has proved that it cannot be influenced and it cannot be taken for granted. RBI has learnt enough of lessons from its past mistakes right from 1949 onwards when BRact was passed.The Corporates monopolised the licences in the early periods and because of their misdeeds and cornering of loans many had to be nationalised in the late 1960s and early 1970s. The 1993 experience was still bad and RBI had to learn new regulatory skills from some of the aggressive banks. The experience of licensing of some banks in the early 2010s was also not so good. The present decision reflects RBI's maturity and the continuous future responsibilities it has, to have a very healthy banking to cater to the needs of equitable development of the economy. Well Done RBI, the only Instituion which can be proud of for its integrity and Corruption free practices. The nation also can be really proud of for having such institutions in the midst of many an institutions which are susceptible to all sorts of irregularities, lobbying, influence and falling easy prey under political pressures. |
Thursday, April 3, 2014
Well done RBI.
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1 comment:
RBI has done its bit. Three comments:
1. By giving licence to Bandan an NBFC-MFI, it has killed a good MFI. Now onwards, for Bandan, MF will be one of the peripheral activities only to meet PSL committment and not the main business on the same lines of any RRB which was started but failed to live up to their expectations. Instead of poor unbanked, the branches of Bandan will be crowded by customers coming in toyatos and hondas.
2. The Governor has also indicated that the licences will be given on tap. May be, as a prudent measure to avoid any comments on issuing licences to others before election, he has released the first list. The second list may be out soon after the election results. So, pl reserve your joy and praise on RBI till then.
3. In allowing defaulters like Kingfisher to move around happily (still not declared by banks as wilful defaulter though Rs.7000+ crore is over due), Sahara companies to still operate though they have violated all KYC norms (more than 20000 addresses not traceable by SEBI. But RBI does not feel anything bad about it and rather maintaining a stoic silence on Sahara case), RBI has not covered itself with any glory and failed to protect the interest of small investors in such NBFCs. I do not know what were the RBI officers inspecting the banks / NBFCs doing when such huge issues were happening around. Also I do not know what the RBI nominees on the Boards of theses banks were doing when loans without adequate collaterals were given and loans went belly up.
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