‘No penalty for not taking decision, but sword for taking one’: why files don’t move in banks

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Synopsis
Bankers say they don’t want to take decisions on loan restructuring or big-ticket lending because they fear investigative agencies might go after them even after their retirement. Little wonder that funding for many projects is getting stuck and revival of projects or companies is sinking.

In a meeting of bankers earlier this year, hectic parleys took place on restructuring loans to a power-sector project. The discussions centered around bringing in a new investor who was ready to pump more money into the project. A majority of the bank consortium had agreed to give the investor a go-ahead. However, officials from two banks refused to budge. They had their reasons – any decision they take today might come to haunt them after