RBI meets heads of private sector banks to assess Covid impact

The Reserve Bank of India Governor Shaktikanta Das and his deputies on Tuesday met with the head of select private sector banks to assess the impact of Covid on the Indian economy, the asset quality of lenders and credit flow to important sectors. The meeting which was held over video conference was also attended by all four deputy governors M. K. Jain, Rajeshwar Rao, Dr. Michael D. Patra and T. Rabi Sankar.

In a statement issued by the RBI, the regulator said that the governor impressed upon banks to quickly and swiftly implement the measures announced by it.

“Das also advised the banks to ensure continuity in provision of various financial services including credit facilities to individuals and businesses in the face of challenges brought on by the pandemic,0 the RBI said. “He also urged them to continue focussing on efforts to further strengthen their balance sheets proactively.”

The RBI has held several meetings with financial institutions in the last two months to gauge the impact of the second Covid wave on bank balance sheets. In line with the potential disruption in businesses and loss of livelihoods the regulator recently introduced a recast scheme for borrowers with loans of upto Rs 25 crore.

The regulator in its meeting also asked banks to ensure that sufficient credit reaches to small borrowers and MSMEs. The RBI to brass also took stock of the progress of the implementation of the first Covid Resolution Framework introduced in August last year, the monetary policy transmission and liquidity scenario and implementation of various Covid-related policy measures taken by RBI.

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