Filling up the lacuna in corporate lending

Criminalising the lender and the defaulter shifts the focus away from the inefficiencies in the corporate lending process

Various reasons have been attributed to the current corporate NPA crisis. That includes legal events, commodity cycle bust and most prominently, errant promoter —and at times senior banker — behaviour. One may conclude that banks have successfully externalised the problem with the message that had it not been for errant promoters and the alleged white color corruption — India’s bad debt problem would not have arisen. It is becoming a regular practice for lenders to ask for forensic audit in the event of a big-ticket default. But is everything okay in the banking sector’s corporate risk management practices? Take the