well written piece.The banks are being made non perforeming with planned loot and this needs to be stopped
once for all. Genuine failure of business and bad debts in banks are understandable but the way the loans
running into crores and crores are turning bad debts is something beyond comprehension . In this context
one is reminded of only what our former Prime Minister Mr Atal Bihari Vajpayee said "We cannot allow
peoples' faith in economic liberalisation to be shaken by those who do business with an ethical deficit".
Lack of professionalism in banks' Boards and lack of discipline among the large borrowers have contributed to
the mess in banks and unfortunately all stake holders of the economy are made to suffer perennially. While
the present inititiative of the Government through Insolvency and Bankruptcy Code can definitely bring in
solid improvements in the recovery of bad debts provided the same borrowers are not allowed to thwart
the scheme through devious means,what the banks need is long term and lasting solution to prevent the
formation of bad debts through bringing in professsionalism in banks Boards and corporate borrowers in
running their businesses.Effective Corporate Governance in banks and accountability to the parliament
can improve the health of both banks' and corporates' balance sheets and make them substantially
contribute to the overall growth of the economy.The acting Finance Minister with his solid finance background and having brought in tangible results in the energy sector can definitely make the banks and the bad
corporates perform better and make the dream of the PM to make the economy grow fast and achieve
welfare for all a reality. Will it not be a good idea to introduce a built in mechanism to discipline the borrowers
and banks and find resources to liquidate bad debts if any by not taxing the tax payers and other
stakeholders of banks?
once for all. Genuine failure of business and bad debts in banks are understandable but the way the loans
running into crores and crores are turning bad debts is something beyond comprehension . In this context
one is reminded of only what our former Prime Minister Mr Atal Bihari Vajpayee said "We cannot allow
peoples' faith in economic liberalisation to be shaken by those who do business with an ethical deficit".
Lack of professionalism in banks' Boards and lack of discipline among the large borrowers have contributed to
the mess in banks and unfortunately all stake holders of the economy are made to suffer perennially. While
the present inititiative of the Government through Insolvency and Bankruptcy Code can definitely bring in
solid improvements in the recovery of bad debts provided the same borrowers are not allowed to thwart
the scheme through devious means,what the banks need is long term and lasting solution to prevent the
formation of bad debts through bringing in professsionalism in banks Boards and corporate borrowers in
running their businesses.Effective Corporate Governance in banks and accountability to the parliament
can improve the health of both banks' and corporates' balance sheets and make them substantially
contribute to the overall growth of the economy.The acting Finance Minister with his solid finance background and having brought in tangible results in the energy sector can definitely make the banks and the bad
corporates perform better and make the dream of the PM to make the economy grow fast and achieve
welfare for all a reality. Will it not be a good idea to introduce a built in mechanism to discipline the borrowers
and banks and find resources to liquidate bad debts if any by not taxing the tax payers and other
stakeholders of banks?
T V G Krishnan
This comment appeared in Money Life dated 22/5/18.
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