Bank Recapitalization

Can it be considered a Silver Bullet?

Finance Minister Arun Jaitley recently said that the government has decided to inject more capital into state-owned banks to strengthen the banking system and spur economic growth.

• In the month of Oct ’17 the government had unveiled a Rs 2.11 lakh crore two-year road map to bolster public sector banks hit by non-performing assets (NPAs), which includes recapitalization bonds, budgetary support and equity dilution.
• In the following article it is being analyzed that whether this pumping of cash into banks would produce effective results. The banks already have lots of stressed and bad debts ....