This is in view of the perception by some of the market players that a significant portion of these standard advances are actually impaired or will turn non-performing with passage of time. The credibility of the Indian banking system is at stake.
This is a concrete example of “credibility counts”, which is the theme of the Auditors’ Day 2013. On 6 July 2012, Danmarks Nationalbank reduced the rate of interest on certificates of deposit to minus 0.2 per. In other words, banks and mortgage banks must pay to hold liquidity at Danmarks Nationalbank; a situation that is unique in both a historical and an international context.