Aug 08, 2013 10:42 AM IST | Source: Moneycontrol.com

Super regulator panel raises concern on bank credit quality

The Finance Stability and Development Council (FSDC), or the super regulator as it is popularly known in the market parlance, expressed concern on the deteriorating credit quality of public sector banks while deliberating corrective measures to fix the problem.

Super regulator panel raises concern on bank credit quality

Moneycontrol Bureau

The Finance Stability and Development Council (FSDC), or the super regulator as it is popularly known in the market parlance, expressed concern on the deteriorating credit quality of public sector banks while deliberating corrective measures to fix the problem.

During the April-June quarter, some state-owned banks like Indian Overseas Bank, Punjab National Bank, Canara Bank and others reported surge in their bad loans or non-performing assets.

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At a meeting of the sub committee of the FSDC held at the Reserve Bank of India (RBI) on Wednesday and attended by top officials from all sector regulators as well as the government, it was decided to create a forum for coordination among related agencies.

"The sub committee resolved to set up a forum for inter agency coordination and exchange of information about collective investment schemes and discussed the need for a nationwide awareness campaign in this respect," RBI said in a release issued late evening today.

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The committee also discussed the potential impact on India of the extra-territorial aspects of regulations by European Securities and Markets Authority (ESMA) and US Commodity Futures Trading Commission (CFTC) and proposed to chalk out a unified strategy for the same.

Recently, Indian bond market reacted sharply interpreting US Federal Reserve statements.

Besides, the issue of banks selling insurance products for more than one insurance company under the bancassurance model also came up for the discussion. The committee tried to focus more on financial inclusion, financial literacy and the inter regulatory coordination.

D. Subbarao, the governor of RBI chaired the meeting. Some of the other prominent officials included Arvind Mayaram, secretary, Department of Economic Affairs (DEA); Rajiv Takru, secretary, Department of Financial Services (DFS); Raghuram Rajan, chief economic adviser; U. K. Sinha, chairman, Securities and Exchange Board of India (SEBI); Yogesh Agarwal, chairman, Pension Fund Regulatory and Development Authority (PFRDA); T. S. Vijayan, chairman, Insurance Regulatory and Development Authority (IRDA) and deputy governors of RBI.

saikat.das@network18online.com

 

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