Public sector banks must move beyond recapitalization bonds
It’s time for PSBs to raise market funds and the Centre to accept 33% ownership of state-run lenders
When a human body suffers a grievous injury, it takes time to heal. In a similar vein, public sector banks (PSBs) suffered a grievous injury when they ended up with a huge amount of gross non-performing assets (NPAs) or bad loans, which peaked at ₹8.96 trillion in March 2018, or around 14.6% of total loans. Bad loans are largely loans which haven’t been repaid for a period of 90 days or more.