Economics
Rajan Chides Scare-Mongers on Bad Debt as India Banks Clean Up
- Turmoil will pass, lenders' health will be restored, he says
- RBI, government will ensure banks are able to fuel growth
This article is for subscribers only.
Dismissing “wild claims” made by some analysts about soured debt in India, central bank Governor Raghuram Rajan assured investors that a clean-up of books underway will help restore lenders’ health and soon position them to revive economic growth.
Projections made by the Reserve Bank of India show any breach of minimum core capital requirements by a few state-owned banks will be small in the absence of recapitalization, he told delegates at a bankers’ conference in Mumbai on Thursday. The RBI and Prime Minister Narendra Modi will do what it takes to nurse them back, he said.