None of the four benchmarks suggested by the RBI is ideal as banks in India create loan assets from their deposits and not borrowing from the regulator or market, says Tamal Bandyopadhyay.
The crisis in confidence in the banking sector is easing. Banks in Europe and America have taken substantial losses both in their proprietary trading departments and in their loan portfolios.
The $5.7 billion total includes $1.6 billion in fines separately imposed by the US Federal Reserve on the five banks.
The government's showcase Indian Infrastructure Finance Company Ltd has run into trouble with two leading global banks - Standard Chartered Bank and Calyon Credit Agricole - suggesting that they may not fulfil collective contractual funding commitments of $250 million
Around $1.54 billion was raised by 60 companies through the automatic approval route, which does not require the approval of RBI or the government, while $520 million was raised by the Exim Bank under the approval route, to meet its lending requirements abroad.
Previous peak in 2010 crossed in first five-and-a-half months this year.
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RBI's forex swap window for oil marketing companies addresses an urgent issue but what happens when the dollars have to be returned?
Since most Indian firms have kept their forex exposure unhedged, credit profile of companies in the highly sensitive sectors such as oil & gas, metal & mining, airlines could weaken substantially, says Anup Roy.
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