Mumbai: RBI Governor Shaktikanta Das on Tuesday asked the lender to proactively identify loans to companies that have changed to be unworthy but have not been recognized as non-performance assets (NPA) due to special dispensation during Covid.
The governor also asked the bank to review the use of capital to absorb losses during the crisis.
Indicates that various high frequency indicators showed that the economic recovery took place, DAS said that there were several resolution frameworks announced after a pandemic.
“Because support steps begins to loosen, some of the restructured accounts may face solvency problems during the upcoming quarter.
Prudence will guarantee proactive recognition of companies that are not feasible for pragmatic resolution steps,” said the watershed.
Speaking at the economic conclave organized by the Bank of India, the DAS noted that the Bank had examined Covid shocks better than expected and, according to the initial trend, bad loans and capital positions have increased in September 2021.
He said the highest bank profitability metrics several years.
However, the enhanced parameters portray the regulatory assistance provided to the Bank during Covid and fiscal guarantees and financial support provided by the government, he said.
“Certain concerns have ran back from the crisis that require our attention.
The most important thing, we are faced with capital questions and the supply of bank buffers, their adequacy and the use produced during the crisis,” said the watershed.
He urged banks to focus and further improve their capital management process to imagine the capacity for the absorption of losses as the responsibility of ongoing loan institutions.
In his speech, the governor also warned the bank in the “technology invasion” they faced.
“Careful words are in order: globally, the ‘Phygital’ revolution has played into several collaborative models between banks, NBFC and Fintech players such as incubation, capital investment, CA-creation, distribution and integration …
it must be recognized by risks Finally lies in the books of banks and NBFC and therefore collaboration must be precisely stated, “said the watershed.