Banks are behemoth's among themselves.They are so big no one will ever be able to put together the pieces of the puzzle.The presiding govt's have used them as a source of funding their vote banks.
NREGA, loans to farmers at concessional rates, loans to co-operative banks funding small scale industries owned by the politicians and their relatives,loans to priority sector i.e. recently real estate sector in distress,extending the time for a loan to have become a default one which will increase penalty are some of the reasons why banks are sitting on such a huge amount of NPA's(Non performing assets) which otherwise affect the interest rates charged from well performing sectors.
If that was not enough we have various amounts of quota to fill up in the job department.After that comes the mother of all i.e. "paid seats/jobs" and the commission on loans provided by the bank which is an end in itself.
If this is the state of the system,the market is giving them unrealistic valuations and the bubble might burst sooner rather than later.
NREGA, loans to farmers at concessional rates, loans to co-operative banks funding small scale industries owned by the politicians and their relatives,loans to priority sector i.e. recently real estate sector in distress,extending the time for a loan to have become a default one which will increase penalty are some of the reasons why banks are sitting on such a huge amount of NPA's(Non performing assets) which otherwise affect the interest rates charged from well performing sectors.
If that was not enough we have various amounts of quota to fill up in the job department.After that comes the mother of all i.e. "paid seats/jobs" and the commission on loans provided by the bank which is an end in itself.
If this is the state of the system,the market is giving them unrealistic valuations and the bubble might burst sooner rather than later.
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