Passage
The funding constraints in international financial markets could impact both the availability and cost of foreign funding for banks and corporates. Since the Indian financial system is bank-dominated, banks’ ability to withstand stress is critical to overall financial stability. Indian banks, however, remain robust, notwithstanding a decline in capital to risk-weighted assets ratio and a rise in non-performing asset levels in the recent past. Capital adequacy levels remain above the regulatory requirements. The financial market infrastructure continues to function without any major disruption. With further globalization, consolidation, deregulation, and diversification of the financial system, the banking business may become more complex and riskier. Issues like risk and liquidity management and enhancing skills, therefore, assume greater significance.
Risk and liquidity management assume more importance in the Indian banking system in the future due to:
- Further globalization.
- More consolidation and deregulation of the financial system.
- Further diversification of the financial system.
- More financial inclusion in the economy.
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Other Questions from this Passage
- View Answer for: According to the passage, the financial markets in emerging market economies, including India, had an adverse impact in recent years due to: Weak global economic prospects. Uncertainties in the international financial markets. Sovereign risk concerns in the Euro area. Bad monsoons and the resultant crop loss.Select the correct answer using the code given below:
According to the passage, the financial markets in emerging market economies, including India, had an adverse impact in recent years due to: Weak global economic prospects.
- Uncertainties in the international financial markets.
- Sovereign risk concerns in the Euro area.
- Bad monsoons and the resultant crop loss.
Select the correct answer using the code given below:
- View Answer for: As per above passage, the Indian financial markets are affected by global changes mainly due to:
As per above passage, the Indian financial markets are affected by global changes mainly due to:
- View Answer for: According to the passage given above, in the Indian financial system, banks’ ability to withstand stress is critical to ensuring overall financial stability because the Indian financial system is:
According to the passage given above, in the Indian financial system, banks’ ability to withstand stress is critical to ensuring overall financial stability because the Indian financial system is:
Comprehension PYQs from 2013
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The need for policy intervention to mitigate risks in agriculture is because
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