The NPA denouement

Govt may have to turn some banks into narrow banks

Banking stocks have in the last few days faced pressure from worried investors after the Reserve Bank of India (RBI) surprised many banks by demanding a sharp increase in their provisioning for non-performing assets (NPAs) that have been put up for fast-track resolution under the new Insolvency and Bankruptcy Code (IBC). The RBI has reportedly asked the banks to set aside at least 50 per cent of the loan amount as likely losses for the dozen cases being settled under the IBC. It has also stipulated that if these cases are not resolved within the initial mandatory period for restructuring