Be watchful, proactive: Shaktikanta Das to PSBs

Reserve Bank Governor Shaktikanta Das on Wednesday met heads of select public sector and private banks to take a stock of credit growth and asset quality in the banking system in the wake of recent geopolitical developments.

He asked banks to remain watchful of the ongoing geopolitical developments and proactively take mitigating measures, including raising capital, in order to minimise the potential impact on their balance sheets.

Das and other top officials of the RBI discussed issues relating to credit offtake, outlook on asset quality, collection efficiency, consumer grievance redress, setting up of digital banking units, resilience of IT infrastructure, and cyber security defences in banks. Credit growth had improved to 11.1 per cent as on April 22.

The meeting follows the recent RBI decision to hike repo rate by 40 basis points to 4.40 per cent. Many banks have raised MCLR and repo-linked lending rates to pass on the rise in cost of funds.

The Governor also urged banks to pay specific attention to further improve their grievance redress systems and continue to provide the necessary support to the ongoing revival of economic activity. The meeting was also attended by the Deputy Governors MK Jain and M Rajeshwar Rao, along with a few senior officials of the RBI.

Das acknowledged the key role played by banks in supporting the economy throughout the pandemic.

He further said that the banking sector has remained resilient and has continued to improve despite facing various headwinds.

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