Note on RBI’s Prompt Corrective Action Framework for Non-Banking Financial Companies
In this note, we discuss how the current approach of the PCA framework is inconsistent with the objectives it seeks to achieve.
Banking | Are Indian investors of a lesser god?
By requiring only limited public reporting on asset quality, banks in India have enjoyed a level of opacity that banks in other jurisdictions do not
RBI must accommodate fintech innovations, not ban them
An RBI Working Group has suggested that lending service providers be disallowed from providing credit enhancements such as FLDG (first-loss-default-guarantee). However, a risk-proportionate regulation of FLDG could address its risks, while allowing the ecosystem to benefit from innovation.
Feedback on the Reserve Bank of India’s Discussion Paper on Review of Prudential Norms for Classification, Valuation and Operations of Investment Portfolio of Commercial Banks dated 14 January 2022
We presented detailed feedback on the Reserve Bank of India’s Discussion Paper on Review of Prudential Norms for Classification, Valuation and Operations of Investment Portfolio of Commercial Banks in the form of answers to the ten questions posed within the Discussion Paper.
Comments on RBI’s Draft Master Direction on Minimum Capital Requirements for Operational Risk
In our response, we commend and highlight the more risk sensitive methodology and the corresponding disclosures outlined in the draft guidelines. However, we also point out that not including conduct risk under operational risk is a major lacuna.
Response to Niti Aayog’s Discussion Paper on “Digital Banks – A Proposal for Licensing and Regulatory Regime in India”
In our response, we question the assumptions put forth by the discussion paper for the creation of DBs and the concomitant licensing and regulatory regime.
Complex vs simple financial instruments: What is in best interest of customer?
Complex financial instruments and products can help consumers to meet their precise financial needs even if they are opaque in their design details due to the underlying mathematical principles. Regulators need to understand that restricting complexity in design is not in the best interests of the consumer.
Policy Brief: A Brief Comparison of the Bad Bank Experience across Jurisdictions
In this policy brief, we compare the design and historical experience of Bad Banks in other jurisdictions with the newly setup NARCL across dimensions relating to legal character, government control, objectives, funding sources, resolution process and level of haircuts.
Contrasting the Financial Disclosures Reported by HDFC Bank Limited in India and in U.S.
In this blogpost, we present the key differences in financial disclosures reported by HDFC Bank Limited in India and in the United States (U.S.). As of March 31, 2021, HDFC Bank Limited (henceforth the bank) had 18.65% of its shareholding in the form of American Depository Shares (ADS) that are listed on the New York Stock Exchange (NYSE).
Part 1- Public Credit Registries: An International Comparison
In this post, we discussed the formulation of the Public Credit Registries.
