No prudential rules/regulations can help save a banking system if there is failure of corporate governance. To avoid the pitfalls observed in the Spanish model, RBI has preferred to take downturn LGD in calibrating expected losses or alpha. This is a prudent approach. Let me now conclude.
Monitoring: need for a structured approach 13. Seventh, we would be closely monitoring the progress made by the banks as per their financial inclusion plans. A structured reporting format has been made available for meaningful compilation and analysis of data. The banks need to do similar structured data compilation exercise at the state/district level which will facilitate monitoring at the district/state/bank level.