Non-Performing Assets in Indian Banks: This Time it is Different

Rajeswari Sengupta and Harsh Vardhan

Working Papers from eSocialSciences

Abstract: Growing non-performing assets is a recurrent problem in the Indian banking sector. Over the past two decades, there have been two such episodes when the banking sector was severely impaired by balance sheet problems. This paper does a comparative analysis of the two banking crisis episodes-the one in the late 1990s and one that started in the aftermath of the 2008 Global Financial Crisis and is yet to be resolved. The paper describes the macroeconomic and banking environment preceding the episodes, the degree and nature of the crises and also discusses the policy responses that have been undertaken. It concludes by drawing policy lessons from this discussion and suggest some measures that can be adopted to better deal with a future balance sheet related crisis in the banking sector such that the impact on the real economy is minimal.

Keywords: Non-performing assets; Public-sector banks; Capital adequacy; Bank recapitalisation; Balance-sheet crisis; banking sector; Global Financial Crisis; banking environment; balance sheet; real economy. (search for similar items in EconPapers)
Date: 2017-09
Note: Institutional Papers
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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Working Paper: Non-performing assets in Indian Banks: This time it is different (2017)
Working Paper: Non-performing assets in Indian Banks: This time it is different (2017)
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