New Delhi [India], March 10 (ANI): Projects with implementation risks should normally be financed by the capital markets and not by banks using public deposits, N S Vishwanathan, Former Deputy Governor, Reserve Bank of India, said on Thursday.

Speaking at an event organised by the industry body Assocham, Vishwanathan said India needs a very strong bond market that can fund projects and manage its risks.

Also Read | @moefcc For the First Time, 57 Indian Skimmers Recorded at River Gomti

Read Here: – Latest Tweet by Prasar Bharati News Services.

"The fundamental risk management and providing liquidity needs to come from the bond market. IBC is one of the legal frameworks enabling the development of the bond market," he said.

He pointed out that if the bond markets develop, the banks must brace up to a situation of higher disintermediation. "The biggest contributor for the net interest margin being higher is the high NPAs. Going forward, we are looking at the Indian banking system having NPAs of globally accepted standards," he said.

Also Read | German Open 2022: PV Sindhu Bows Out After Losing to Zhang Yi Man.

Vishwanathan highlighted that credit culture in India is a function of many things. "The quality of credit in the bank, the post-credit follow-up and the legal system for recovery are some of the factors which determine it. If you don't have all these things, you reduce the probability of default and bring down the loss given default," he said. (ANI)

(The above story is verified and authored by ANI staff, ANI is South Asia's leading multimedia news agency with over 100 bureaus in India, South Asia and across the globe. ANI brings the latest news on Politics and Current Affairs in India & around the World, Sports, Health, Fitness, Entertainment, & News. The views appearing in the above post do not reflect the opinions of LatestLY)