Budget: India to set up bad bank to manage record levels of soured debt

India will set up a company to manage bad debt for banks, which is expected to reach record levels this year, threatening financial stability in the world’s second-most populous nation.
 

The firm will hold problem loans for banks, which can then be sold on to investors at a reduced price, according to plans outlined by Finance Minister Nirmala Sitharaman in a budget speech on Monday. An index of bank shares surged the most since May.

Indian lenders -- like global peers -- are struggling with the economic fallout of the coronavirus , which has triggered an unprecedented economic slump hurting