PNB scam likely a fraudulent intent than whole banking systemic issue: Ashvin Parekh

Public sector banks seem to limp back to normalcy after the PNB scam and after an unconfirmed report saying that the bank is ready to pay other banks with some riders.

So the big question is - is the worst over for these banks and will they manage to stablise asset quality?

To answer some of these and other questions, CNBC-TV18 spoke to Ashvin parekh, Managing Partner, Ashvin Parekh Advisory Services.

Since we are close to the end of the financial year and if the report is correct then it looks like a very prudent decision on part of the bank and the RBI, said Parekh, adding that till the full clarity emerges on the case, maybe post March, if only PNB were to take the hit on the books now it would be wise decision.

Out of the Rs 13000 crore Nirav Modi scam, Rs 6000 crore belongs to PNB and the rest to some other banks.

With this case, it has become clear that there is weakness in the system and a fraudulent intent but the PNB case could be more a fraudulent intent which looked for weaknesses in the system and beat it.

As of now it looks like few fraudulent cases rather than an entire banking wide systemic issue.