President Pranab Mukherjee on Friday approved an ordinance on Non-Performing Assets (NPA), giving more power to the Reserve Bank of India (RBI) to tackle mounting bad loans.
The Cabinet on Wednesday had approved promulgation of an ordinance to amend the Banking Regulation Act (BRA) for resolution of the NPA crisis.
The amendments to the Act will help in effectively resolving the bad loans problem, Finance Secretary Ashok Lavasa had said on Thursday.
“It is not possible for me to put down a number on how this (NPAs) will go down, but certainly we feel that these changes will make the system more effective in handling the bad loans,” he was quoted as saying a news agency.
According to reports, the RBI has introduced a number of steps such as Strategic Debt Restructuring (SDR) and Scheme for Sustainable Structuring of Stressed Assets (S4A) to deal with the bad loans menace.