P). The one major cause for the current weakened state of Indian banks is the level and volume of non-performing assets.
1). Yet, the fact remains that the banks allowed themselves to be pressurized into lowering their guard in the one area of business that is and should be their bread and butter of existence- risk assessment.
2). Description such as 'deceased portfolio' and figures running into thousands of crores have all led to treating the problem as a major one-time aberration requiring emergency treatment.
3). The causal explanations - political interference, wilful defaults, targeted lending and even fraudulent behaviours by banks - have some grain of truth in them.
4). The problem has not been looked at in its proper perspective.
Q). The response from the banks is to concentrate on somehow reducing the amount and number of accounts in this category.
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