Reserve Bank of India (RBI) is not considering extending the March 2017 deadline it has set for banks to clean up their balance sheets, Deputy Governor S.S. Mundra said on Friday.
"We have made it quite clear that banks must take proactive steps and conservative approach" with regard to their non-performing assets by that time, he told presspersons here.
Mr. Mundra was in Hyderabad for a banking research conference organised by Gokhale Institute of Politics anf Economics and ICFAI Business School (IBS).
The clean -up process had already been initiated with the December quarter being the first, he said, adding that hence there is "no trigger to revisit the deadline."
To a query on the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI) he said the legal system as it exists today makes it possible for large borrowers to stall the recovery by banks. In the process, small borrowers also end up being "dealt with more severely."
Mr. Mundra, however, expected the situation with regard to recovery from large borrowers to change with the Bankruptcy Code.
Earlier at the conference, he underscored the need for quality research on credit disbursement to agriculture and MSMEs and credit leverage by private sector, especially corporates.
