Bankers Trust:

Is Bank Recap Any Different From Farm Loan Waiver?

Is Bank Recap Any Different From Farm Loan Waiver?

The CEOs of bad debt-laden state-owned banks should start partying, thanks to the early arrival of Christmas after a stressful year, relentlessly chasing rogue borrowers for recovery of the money lent. Last week, Finance Minister Arun Jaitley played Santa Claus for them by seeking Parliament’s approval for Rs 410 billion capital infusion in these banks. The government had budgeted for Rs 650 billion fund infusion during the current year, of which Rs 420 billion is still to be allotted.

Bankers Trust:

Going Beyond Policy Statement, Reserve Bank Gives Guidance

Going Beyond Policy Statement, Reserve Bank Gives Guidance

The fifth bi-monthly monetary policy statement of the Reserve Bank of India (RBI) had no surprise as the central bank’ action — or, the lack of it — has been on the expected line but going beyond the statement, for the first time, Governor Urjit Patel and Deputy Governor Viral Acharya have given guidance to the markets. At the post-policy interaction with the media, Patel has said if the upside risks to inflation do not materialise, there is a possibility of space opening up for appropriate RBI action. This clearly means that the Indian central bank is not ruling out a change in stance (to neural) or even a rate cut.