INSUBCONTINENT EXCLUSIVE:
RBI Governor Shaktikanta Das said the provision coverage ratio has risen to 60.5% from 48.3% a year agoReserve Bank of India (RBI) chief
Shaktikanta Das called for stronger corporate governance at state-run lenders to make the country's banking sector more
efficient.Describing the lack of strict governance as the "elephant in the room," Mr Das said this had led to elevated levels of
non-performing assets, capital shortfalls, fraud and inadequate risk management."The role of independent boards in fostering a compliance
culture by establishing the proper systems of control, audit and distinct reporting of business and risk management has been found wanting
in some public-sector banks leading to build-up of NPAs," Mr Das told an audience in Ahmedabad.State-run lenders control about 60 per cent
of India's banking industry
They are owned by the government, with the Reserve Bank of India having limited supervision and legal powers to bring about changes in
management, unlike privately-owned ones over which is holds more sway
That creates an uneven playing field leading to question marks about the efficacy of central bank regulations over state-run
institutions.India's banking sector has the highest ratio of stressed assets in the world, with many bad loans to companies in sectors
A crisis in shadow banking has also raised further concern that banks, which have 7 per cent of their loans to non-banking finance
companies, will face a fresh spate of debt defaults.Mr Das said that while the number of NPAs has declined recently, the provision coverage
ratio has increased to 60.5 per cent from 48.3 per cent a year ago
The capital adequacy ratio in the banking system has also climbed to above the Basel requirements, he said.Get Breaking news, live coverage,
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