MUMBAI, May 29 (Reuters) - The Reserve Bank of India has come across instances of some banks trying to conceal the real status of their stressed asset

India RBI chief flags governance gaps, stressed assets misreporting at some banks

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2023-05-30 02:30:06

MUMBAI, May 29 (Reuters) - The Reserve Bank of India has come across instances of some banks trying to conceal the real status of their stressed assets while governance gaps have also been noticed at certain lenders, its governor said on Monday.

"During the course of our supervisory process, certain instances of using innovative ways to conceal the real status of stressed loans have also come to our notice," Shaktikanta Das said during his inaugural address to directors of banks at a conference organised by the RBI.

Das did not name any bank. Instead, citing examples, the governor said that supervisors had spotted some instances of sale and buyback of stressed loans between two lenders, structured deals with good borrowers to conceal stress and disbursement of new loans close to the time of repayment.

Das also said that despite the guidelines on corporate governance, it was a matter of concern that the RBI has come across gaps in governance at certain banks, which have the potential to cause some volatility in the sector.