Atul Joshi, Managing Director and Chief Executive Officer, India Ratings & Research, a Fitch Group company, feels the banking sector has been drawing flak for many mistakes not committed by it.
In an interview with Business Line, he spoke of the changes that have come by in the business of ratings and the inability of India Inc to take on more debt without compromising its credit metrics. Excerpts:
What is your outlook on the borrowing cost for India Inc?
The borrowing cost may rise in the short term, but the same cannot be said of the long term. There is a sentiment issue due to inflation and currency depreciation and, as a result, the good ones are getting painted with the same brush in some cases. However, the loss given default (default less recovery) is close to zero. Our banking system is one of the best in the world. Recovery of restructured loans is as high as 80-85 per cent.
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