Mumbai, August 27
Addressing a webinar, RBI Governor Shaktikanta Das immediately requested banks to keep away from excessive threat aversion, because it was “self-defeating”. He suggested them to odor vulnerabilities early to keep away from frauds.
The feedback come within the midst of the steadily slowing credit score off-take, main many to surprise if banks have change into too “risk-averse” owing to their issues over asset high quality in a pandemic-stricken economic system.
As per the RBI’s annual report launched earlier this week, frauds doubled to Rs 1.85 lakh crore in FY20.
Das warned banks that excessive threat aversion would deprive them of their earnings and create a scenario the place they’d be unable to earn their bread.
He appreciated the federal government’s response to the Covid-19 disaster as being fiscally “very prudent and very calibrated”. He mentioned the federal government was “responsible” in saying the measures proper from the beginning which targeted on the poor and weak.
He additionally welcomed the federal government’s technique of consolidating public sector banks, saying lenders with massive steadiness sheets can be useful. He, nevertheless, mentioned that whereas dimension was important, effectivity was “more important”. “There is no risk aversion but prudent banking. If we give money, we expect to get it back,” mentioned Aditya Puri, MD, HDFC Bank— PTI