RBI board meets digitally to take stock of Covid-19 impact on economy

While there was an expectation that the board would also discuss one-time restructuring scheme for stressed assets of banks, it was not there in the agenda for the board meet

The Reserve Bank of India (RBI) central board met on Friday via videoconferencing to discuss the impact of measures undertaken by the central bank after the Covid-19 outbreak in India, among other issues.

The meeting deliberated on the current economic situation and the evolving challenges posed by the pandemic, the RBI said, adding, “among others, the board also discussed the Reserve Bank’s activities during the period (July 2019-June 2020), the budget for the next accounting year July 2020 to March 2021 (aligned with the government’s financial year), and other policy and operational matters”.

While there was an expectation that the board would also discuss a one-time restructuring scheme for stressed assets of banks, the RBI statement did not mention it specifically. 

Finance Minister Nirmala Sitharaman on Thursday had said that a one-time loan restructuring facility for non-MSMEs (medium, small and micro enterprises) was under active consideration. 

“An intense engagement is on with the RBI to come up with such a scheme. There is a lot of stress now,” she said at a webinar organised by the Chennai International Centre.

The RBI statement mentioned about other matters, but did not give the details. 

A source said: "Such restructuring is a long-standing demand of banks too, especially considering the stress after the Covid-related lockdown," the source said.

The RBI board meet was chaired by Governor Shaktikanta Das, and was attended by all deputy governors, and other directors of the bank — N Chandrasekaran, Ashok Gulati, Manish Sabharwal, Prasanna Kumar Mohanty, Dilip S Shanghvi, Satish K Marathe, Revathy Iyer, and Sachin Chaturvedi. Tarun Bajaj, secretary, Department of Economic Affairs; and Debasish Panda, secretary, Department of Financial Services, also attended the meeting.