Financial Daily from THE HINDU group of publications
Wednesday, Apr 03, 2002
Financial Daily from THE HINDU group of publications Wednesday, Apr 03, 2002 |
|
|
|
|
|
Opinion
-
Letters Banking system
This refers to `Indian Bank recap may come with riders' (Business Line, March 18). The imposition of such conditionalities by the Government in the case of Indian Bank's recapitalisation is somewhat of a joke. Indian Bank has come to this sorry state of affairs not due to its staff, but due to the non-payment of interest on the loans by several borrowers. Many borrowers have misused/diverted crores of rupees worth of bank loans. So, the need is to pass a law in Parliament empowering the branch managers to seize the assets of the defaulters and sell them in the market. This will automatically bring cash to the bank and reduce NPAs, and the need for recapitalisation will never arise. This step will prevent any l diversion of funds by the borrowers. At present, as the laws favour the borrowers, many of them do whatever they want with bank loans. Under these circumstances, it is surprising that the Narasimham Committee has recommended the setting up of asset reconstruction companies to recover NPAs (which will simply transfer the problem rather than solve it) instead of recommending powers to branch managers to sell defaulters' assets. N. Kalyanaraman
Send this article to Friends by E-Mail
|
Stories in this Section |
|
The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription Group Sites: The Hindu | Business Line | The Sportstar | Frontline | Home |
Copyright © 2002, The
Hindu Business Line. Republication or redissemination of the contents of
this screen are expressly prohibited without the written consent of
The Hindu Business Line
|