With a sense of optimism slowly creeping in, the banking industry is hopeful that 2015 will bring better growth prospects.
This optimism stems from a number of factors. For one, the Government is working hard to revitalise the industrial growth in the country. For another, the Reserve Bank of India has initiated a numbers of measures that would go a long way in helping the banks to restructure.
The recent announcements of RBI, it is felt, are a clear pointer to the future of the restructured domestic banking industry.
Yet, the bulging non-performing assets (NPAs) remain a big challenge, especially the public sector banks. In an effort to address this issue, the RBI Governor Raghuram Rajan unleashed several measures, including a recent circular which was hard on evasive borrowers.
“The worst is more or less over for the banking industry,” said B. Sriram, Managing Director, State Bank of India. He felt that the credit growth would definitely pick up in 2015, which would likely to grow by 3 to 4 per cent. Mr. Sriram said the aggressive measures taken by the central bank would help banks to have control over probable and prospective NPAs.
“The out-turn of anticipated macro-economic improvements should prove to be salutary for the Indian banking sector, which has been weighed under the pressure of rising stressed assets especially in the infrastructure sector,” said Rana Kapoor, Managing Director & CEO, Yes Bank.
The economic turnaround accompanied by recent policy initiatives to de-bottleneck projects stuck for want of approvals along with RBI’s efforts to provide banks the flexibility to restructure infrastructure loans and incentivize raising long-term funds should allow incremental mending of Indian banks’ balance sheets. Mr. Kapoor said ‘Pradhan Mantri Jan Dhan Scheme’ could prove to be a game-changer for India’s financial landscape.
COMMents
SHARE