Banks have largely stabilized their balance sheets by moving away from industrial stress and focusing on retail lending, easing the NPA crisis. But the unintended fallout is a squeeze on credit flow to smaller businesses and firms that create jobs, raising concerns about growth and employment as credit shifts to consumers instead.
Alleged issues at IndusInd Bank stretch across multiple fiscal years, with reported concerns over lending and risk management plus disclosures. Variances in gross and net NPAs emerged in FY16, followed by misreporting in FY17. The widening gap has raised questions about whether regulatory rules were respected as divergences grew.
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