RBI's new stressed assets scheme better than SDR: UCO Bank

The Reserve Bank of India's new Scheme for Sustainable Structuring of Stressed Assets is a good move and stands a better chance of being a success compared with strategic debt restructuring (SDR), said Ravi Krishan Takkar, MD and CEO of UCO Bank. The guidelines allow the banks to divide debt into sustainable and non-sustainable, and manage bad loans more effectively.The scheme will help banks with large corporate accounts in textiles, iron and  steel and power sectors, he said. He added that as per the guidelines, the banks will have to make adequate provisions to absorb the haircut that will be taken by them. However, these provisions will have a short-term impact on the books of the banks, he maintained. Watch video for full interview...