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RBI wields new powers

The Reserve Bank of India (RBI) has started to put to use its new powers to clean up the banking sector. Earlier this month it instructed several commercial banks to begin insolvency proceedings against the biggest corporate defaulters. On some estimates, the 12 targeted firms account for 25% of non-performing loans in the system. As such, swift resolution of these cases would go a long way to cleaning up banks’ balance sheets.

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