On Wednesday, RBI Das, Shaktikanta Das, governor of Reserve Bank of India (1), says that banks must improve their business strategies. He asks banks to keep their watch for new promising, and emerging sectors. He also requested money lenders to give out their supports for industries with the potential to bounce back.
Das said that banks could focus on the rural sectors for emerging opportunities during his keynote address at a Business Standard event. It includes startups, logistics, renewables, and value chains, among others. He also asked banks to remain cautious in light of recent bank frauds. RBI Das further tells banks to increase their risk management power while sanctioning loans and post-sanction monitoring.
RBI Won’t Lose Measures Announced During Pandemic Anytime Soon: RBI Das
He affirmed that RBI would not look at loosening any measures announced during the pandemic shortly after elevating the lockdown. He said RBI is observing the circumstances and will plan out an extremely cautious exit plan.
RBI Das further added that RBI won’t unwind any measures immediately. The reserve bank is exercising a long-term plan for resolutions and actions.
He further restated that the pandemic is likely to put stress on banks’ balance sheets. It may commence an erosion of capital. Hence, the Banks requires a rejoinder to this challenge proactively, he added.
As per the RBI Das, us saying that the balance sheet will be under pressure amid pandemic is like stating the obvious. The more vital thing in the current situation is how money lenders react and respond to the challenge. RBI Das further added that the banking sector is currently sound and stable and doing better if we see a bigger picture.