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Articles by K B L MathurSubscribe to K B L Mathur

Convergence and Divergence of Indian Banking

Vol. 42, Issue No. 51, 22 Dec, 2007
K B L Mathur

The Reserve Bank of India's report 'Trend and Progress of Banking in India 2006-07' states that the Indian commercial banking system has achieved remarkable soundness, dynamism and resilience. And that there is also a convergence in the levels of soundness of public sector banks and new private banks. However, the RBI's claim that the indicators of soundness for Indian banks compare well with international standards is not convincing.

Financial Sector in India

Vol. 42, Issue No. 13, 31 Mar, 2007
K B L Mathur

that

Mythology of Banking Ownership

Vol. 41, Issue No. 49, 09 Dec, 2006
K B L Mathur

The Reserve Bank of India's report, Trend and Progress in Indian Banking 2005-06 describes the success story of the Indian banking system and also challenges some conclusions on the issue of state ownership of banks. Contrary to the conclusions arrived at by several cross-country studies, the Indian banking system, despite maintaining significant state ownership, has increased bank productivity and efficiency, enhanced credit access, and is now in a sounder state.

Finance Commission and Backward States

Vol. 41, Issue No. 35, 02 Sep, 2006
K B L Mathur

Commission. And that is what was found by the TFC. Punjab and Kerala both being Finance Commission high per capita income level states were assessed to have per capita pre-devolution revenue deficit of the order which was and Backward States K B L MATHUR Even though this is not the season for comments on Finance Commission issues, the provocation for this piece is to respond, in brief, to a minor but important issue raised by G R Reddy (EPW, August 12, 2006) in the special article on

Insights into Privatisation

Vol. 40, Issue No. 33, 13 Aug, 2005
K B L Mathur

Privatisation in India: Challenging Economic Orthodoxy by T T Ram Mohan; RoutledgeCurzon, New York, 2005; pp 213, price not mentioned.

Market Orientation of Financial Sector

Vol. 40, Issue No. 12, 19 Mar, 2005
K B L Mathur

Specific to the financial sector in India, this paper reviews the role of state as a facilitator for market orientation through: (i) legislative changes, (ii) competition enhancing measures, (iii) institution-building, (iv) dispute resolution systems, and (v) market deepening actions. An analysis of legislative measures undertaken by the government of India shows that out of the 43 legislative acts/subordinate laws administered by the banking division of the department of economic affairs, finance ministry, almost 50 per cent are in the nature of facilitating the development of the financial sector. For providing a market orientation to the financial sector the state in India earlier played a historical role and is now facilitating restructuring as well as consolidation. Providing functional autonomy and operational flexibility to public sector banks has been the main contribution of the state in facilitating market orientation of banks.

The Growth Rate Mystery

Vol. 39, Issue No. 29, 17 Jul, 2004
K B L Mathur

Regardless of the degree of gain achieved consequent upon the changes in the economic policy there is no dispute over the fact that the 1991 crisis was converted into an opportunity to change the direction of the economy. What then are the points at issue? Three major studies published recently have explored the change of trajectory of the long-term growth rate of the Indian economy. But these studies also leave messages that are contradictory, if not confusing.

Regulation of India's Financial Sector

Vol. 39, Issue No. 12, 20 Mar, 2004
K B L Mathur

This paper assesses the role of the state in regulating the financial sector in India. It attempts to find the rationale for the role of state in a regulatory system, develops a framework for a regulatory mechanism and reviews state policy as well as the existing regulatory structure in India. An assessment based on standard parameters indicates that all regulatory agencies have the state's presence. Also, an assessment made on the basis of international codes and standards shows a high degree of compliance of supervisory standards in the banking segment. In obtaining and maintaining these standards the state has played a significant role through legislative, consultative and supportive measures.

Development Financial Institutions at the Crossroads

Vol. 38, Issue No. 08, 16 Feb, 2003
K B L Mathur

at the Crossroads The DFI model has failed in India. ICICI has become a universal bank. The IDBI repeal bill has been introduced in the Lok Sabha. IFCI has almost collapsed, its networth being negative. The condition of other DFIs is no better. There were structural infirmities in the model. NPAs and lack of concessional funds made DFI operations unsustainable. Finally, the policy framework designed the exit. The alternative, i e, universal banking is likely to face bigger challenges. Both the regulator and the government may have to initiate some measures to fill in the gap created by the demise of DFIs. Banks may have to be provided long-term funds facility to meet investment needs of long-gestation and infrastructure projects.

Public Sector Banks in India

Vol. 37, Issue No. 23, 08 Jun, 2002
K B L Mathur

An examination of the main arguments extended to build a case for privatisation of the public sector banks (PSBs) in India reveals that the arguments are based on (a) perceptions rather than factual analysis; (b) the use of partial information; and (c) evidence on international experience which is not unambiguous. It can be concluded that the case for privatisation of PSBs in India is not strong enough at least on the grounds usually proposed by the advocates of privatisation. Private sector banking would have a larger probability of crisis if the supporting legal and regulatory framework were not sound enough to insulate the systems from extraneous pressures. It may, therefore, be safer to maintain the public sector character of the banks till the conditions for privatisation are conducive enough.

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