RBI governor adds that the central bank will also undertake measures to help create favorable conditions for robust and stable growth in the economy
The Reserve Bank of India (RBI) will take necessary steps to fortify corporate governance in the country’s state-run banks to crack down on the incidence of financial frauds, Shaktikanta Das said at an investor roundtable. In his first public speech since becoming RBI head last month, Das added that the central bank will also undertake measures to help create favorable conditions for growth in the economy.
PSBs On The Fast Recovery Lane
Public sector banks in the country have been hit by a series of frauds in recent years, including the Rs 14,000 crore-fraud committed at Punjab National Bank. "The government, the Banks Board Bureau and the Reserve Bank are currently engaged in developing an objective framework for performance evaluation and this should redefine the contours of corporate governance in the public sector banks (PSBs) with a focus on transparency, accountability, and skills," Das said.
Das, who will chair the Monetary Policy Committee meeting in February, said the RBI "will take the necessary steps to maintain financial stability and facilitate enabling conditions for sustainable and robust growth."
RBI will enable NBFCs to play a vital role
Das added that the RBI will also boost the asset liability management (ALM) framework for non-banking financial companies (NBFCs) and harmonize it across different categories.
"will take the necessary steps to maintain financial stability and facilitate enabling conditions for sustainable and robust growth."
"The Reserve Bank intends to strengthen the ALM framework for NBFCs and harmonize it across different categories of NBFCs with the objective of enabling the NBFCs to play a vital role in our economy," he said.
Das, who also held key positions under both the ruling Bharatiya Janata Party and the Congress-led government before retiring in 2017, also addressed challenges that Indian companies may face on account of developments around the Brexit.