Divergence between governance policies and practices
If the banks were to be strong and resilient... the governance "practices" have to be sound and robust The influence, the Chief Executive Officers (CEO) (who quite often appear to forget their responsibilities to the Board as a Managing Director) and the respective managements had on the boards of a few scheduled commercial banks (SCBs) came to the fore, when the hidden gross NPAs, and the unprovided provisions thereon, were brought out in the Asset Quality Review (AQR) conducted by RBI in 2016. The regulator brought out a "discussion paper on governance in commercial banks in India" in 2020. Even after that, non-compliance and flouting of corporate governance guidelines continue to hog the limelight, as evidenced in the episodes of LVB, Yes Bank, PMC Bank, RBL Bank, Paytm Payment Bank, NICB, etc. resulting in take over, change of ownership/ board/ management control and even shut down of operations in one case. The irregularities in VIDEOCON loan sanction/renewa...