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RBI urges banks to ensure timely resolution of stressed assets
Aug-21-2019

The Reserve Bank of India’s (RBI) deputy governor NS Vishwanathan has urged bankers to ensure timely resolution of stressed assets under the RBI's new NPA recognition and resolution guidelines to extract the best value. He underlined the need for dealing only in genuine cases. He added that the central bank will soon be releasing final guidelines for private and foreign bankers' compensation.

Vishwanathan said the RBI's revised framework for resolution of bad assets is less intrusive as it gives banks the leeway to draft their own resolution plans for a particular case. He also said “timely resolution is very important. I'd request you to ensure that the resolutions are done in time, not just for the regulatory requirement but also because it will result in better valuation going forward.'

RBI deputy governor further said that the central bank has given a lot of freedom to banks to determine the contours. He said “we are making less intrusive regulations and hope that banks will use this to deal with genuine stress in their balance sheets to address the problem.'  
 

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