Bad bank - Good bank
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When I applied for a new bank account in ICICI last month, I didn’t even thought they will prove themselves as bad bank by taking so much time to open a normal account. Now a days Sarkari banks are not that bad, there’s lots of lochha in so called professional private banks. Anyway these guys does have their ways to mask themselves, beyond the scope of this piece of article.
ARCIL - Asset Reconstruction Company India Limited - is a company sponsored by leading players in the Indian financial sector – SBI, ICICI Bank, IDBI and Punjab National Bank. It is an Asset Reconstruction Company (ARC). ARCs act as debt aggregators and engage in acquisition of NPAs (Non Performing Asset means an asset or account of borrower, which has been classified by a bank or financial institution as sub-standard, doubtful or loss asset, in accordance with the directions or guidelines relating to asset classification issued by RBI). Thus ARCs take away the distraction by isolating NPAs from the banking system and act as “bad bank”. This leaves rest of the banking system free to act as “good bank” and return to equity markets and normal banking business. Governments encourage transfer of assets to ARCs through creation of supportive environment.
Governments may also provide special powers to ARCs that are not otherwise available to banking system. We must also note Indian banking system has NPAs of over Rs. 4 lakh crores.
Rajesh wrote,
u r right… so called these professional banks are only n’ very professional about how to make money from their customer, they don’t even miss a chance to take out single penny from their customers, and about sarkari(Govt) banks they are becoming professional but their pace is like hare n’ tortoise race with private banks, one thing i don’t like about sarkari bank is that their processes are too long and full of red tapism i believe if they come over this and make a simplified process and take care of customer then sarkari banks are better than private professional banks
Link | November 7th, 2007 at 4:22 am
Narendra wrote,
Till now my experience with India’s largest public sector bank is excellent. In cities (Kolkata, and Hyderabad where I had accounts) I found superb services. I haven’t tried their cards (where I think they give a little trouble, but as they say if you want to be happy stay away from credit cards)
Link | November 7th, 2007 at 5:49 am