This refers to the article, “The ugly truth about our banks” (June 3) by Sandeep Bamzai. Banking is a risky business and requires intelligent and honest risk assessment even in normal circumstances. Some loans will fail as all business do not succeed. But banks cannot afford to lose money to thieves.
On the other hand, banks do not mint money, they get it from the depositors and banks cannot allow a situation where the depositors lose their deposits. To tackle the situation, the Reserve Bank of India can institute an insurance policy which guarantees the safety of deposits, as it is done by the Federal Deposit Insurance Corporation in the US and make its regulation and oversight of banks far more stringent than they are now.