Narasimham Committee on Banking Sector Reforms

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Narasimham Committee on Banking Sector Reforms (1998) The purpose of the Narasimham-I Committee was to study all aspects relating to the structure, organization, functions and procedures of the financial systems and to recommend improvements in their efficiency and productivity. The Narasimham-II Committee was tasked with the progress review of the implementation of the banking reforms since 1992 with the aim of further strengthening the financial institutions of India.[4] It focussed on issues like size of banks and capital Adequacy ratio among other things The 1998 report of the Committee to the GOI made the following major recommendations: Autonomy in Banking Greater autonomy was proposed for the public sector banks in order for…show more content…
The committee had highlighted that 'priority sector lending ' was leading to the build up of non-performing assets of the banks and thus it recommended it to be phased out.[10] Subsequently, the Narasimham Committee-II also highlighted the need for 'zero ' non-performing assets for all Indian banks with International presence.[10] The 1998 report further blamed poor credit decisions, behest-lending and cyclical economic factors among other reasons for the build up
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