Rajan took many steps to put banking system in right

direction: President Chennai, Sep 10 (PTI) Just retired RBI Governor RaghuramRajan’s clean-up of more than USD 100 billion of stressedassets on the books of banks today came in for praise fromPresident Pranab Mukherjee who felt rising NPAs are not adesirable situation. "Of course more than often you listen to NPAs of bankingsystem, which is no doubt a matter of concern. And Governor ofRBI who has just retired, Mr Rajan, took many appropriatesteps to put the system in the right direction," he said atthe centenary celebrations of Karur Vysya Bank here. The stressed advances to gross advances of scheduledcommercial banks have increased from 10.90 per cent in March2015 to 11.40 per cent in March 2016, he said, adding theaggregate provisions for NPAs has increased from Rs 73,887crore to Rs 1,70,630 crore. Also, net profits of the banks have come down from Rs79,465 crore in March 2015 to Rs 32,285 crore in March 2016,he said. Rising NPAs is "not a desirable situation," he said,adding those resources must be available for commercialdisbursement. Rajan, who completed his three-year term as Governor ofthe Reserve Bank of India on September 4, had forced banks torecognize the true state of their bad loans. This culminatedin a six-month asset-quality review that led to banksreporting a surge in bad-debt disclosures and higher lossesthis year. Mukherjee said Indian economy and its banking system hasdone reasonable well considering "indiscretion of a privatebank (abroad) could create such an international financialcrisis from which world is yet to recover." Forecasts of the IMF and World Bank are revised and re-revised year after year because world economy is hit by oneafter another crisis and overall performance of majoreconomies of world are not so bright and prosperous, he said. "Everybody at that point of time pointed out that when themajor banking institutions in international arena weresuffering, Indian banking system stood firmly and solidlybecause of its prudent management not indulging in some sortof profligation. I am happy to note that because of the basicfoundations, and strength of our macroeconomic indices, Indianeconomy is doing reasonably well," he said. PTI JD ANZABK