Photo: ReutersIndia’s banks were hoping the regulator would feel the pain of their bond-market losses and maybe offer a palliative. The yield on the new benchmark 10-year government bond jumped 11 basis points on Tuesday, to 7.38%. If the RBI is now frustrated with the state-run banks for having loved sovereign debt a bit too much last year, it also must accept some blame. As many as 11 of India’s 21 publicly traded state-run banks are currently under their regulator’s so-called “prompt corrective action” regime, having racked up huge bad loans on corporate advances. Until then, the regulator can admonish the banks all it wants—but it can’t deny them succor when they come running.

Source: Mint January 17, 2018 08:15 UTC