Business Standard

RBI's out-of-the-box solutions may strengthen India's banking sector

Whether YES Bank, PMC Bank or LVB, year 2020 has seen the regulator taking market-oriented solutions to rescue failed banks

RBI
Premium

Lately, the banking regulator has not opted for the usual rescue measure of merging troubled banks with a public or private sector bank

Hamsini Karthik Mumbai
Beleaguered lenders YES Bank, Punjab and Maharashtra Co-operative Bank (PMC Bank), and Lakshmi Vilas Bank (LVB) have a common link, besides being troubled names. 

When in deep distress, the Reserve Bank of India (RBI) did not go for the tried-and-tested measure of merging them with a public or private sector bank. Rather, it took a different approach towards their rescue. In the case of YES Bank, State Bank of India took only 49 per cent stake (with private lenders acquiring a smaller stake) to ensure stability. PMC Bank, placed under moratorium in September 2019, stunned many by welcoming applications from

What you get on BS Premium?

  • Unlock 30+ premium stories daily hand-picked by our editors, across devices on browser and app.
  • Pick your 5 favourite companies, get a daily email with all news updates on them.
  • Full access to our intuitive epaper - clip, save, share articles from any device; newspaper archives from 2006.
  • Preferential invites to Business Standard events.
  • Curated newsletters on markets, personal finance, policy & politics, start-ups, technology, and more.
VIEW ALL FAQs

Need More Information - write to us at assist@bsmail.in