Context: Given that PSBs account for 90% of the shortage, a credible divestment plan would reveal some well-capitalized suitors among private banks.
Issues with the Financial Sector: In the light of capital shortfall in the financial sector, certain trends have been identified since the Global Financial Crisis (GFC) of 2008
Way Forward: The solution is to enable a graceful transfer of the deposit and funding “franchise” from capital-deficient firms to capital-surplus firms. The government must prepare a significant plan to