Stressed assets and banking in India

Abstract

Stressed assets have been rising rapidly in India, mainly in public sector banks. A number of factors can be identified that have led to this situation. These include global slow down, governance related issues, political factors as well as mal-intentions and misconduct. Consequently, significant losses are incurred by the public as well as the Union Government which basically owns public sector banks. The chances of misconduct are substantially large in case of infrastructure project especially under public private partnership. There is need to take this opportunity to undertake extensive research into the factors which have led to deteriorating asset quality in public sector banks.