RBI governor describes Banking recapitalisation move a monumental step forward

Mumbai, Oct 25: The Reserve Bank of India today described the Union Government’s move to recapitalise PSU Banks as a ‘’monumental step forward in safeguarding trhe country’s economic future. In a statement here RBI Governor Urjit R Patel said ‘’for the first time in last decade, we now have a real chance that all the policy pieces of the jigsaw puzzle will be in place for a comprehensive and coherent, rather than piece-meal, strategy to address the banking sector challenges. ‘’ He said ‘’ It bodes us well that this step has been taken in a time of sound macroeconomic conditions for the economy on other fronts’’. He said a well-capitalised banking, and in general, financial intermediation, system was a pre-requisite for stable economic growth. Economic history has shown us repeatedly that it is only healthy banks that lend to healthy firms and borrowers, creating a virtuous cycle of investment and job creation. UNI