The debt crisis in IL&FS has adversely impacted growth of the NBFC sector in India and might lead to its consolidation, said a report by Fitch Ratings on shadow banking. Non-banking financial companies (NBFCs) are commonly referred to as the shadow banking sector. The report comes against the backdrop of the Reserve Bank of India\u2019s decision to create a specialised cadre to supervise and regulate the financial sector, including banks and NBFCs.<\/p>\n
The Indian shadow banking industry\u2019s rapid growth and reliance on short-term funding sources \u201cbubbled over\u201d in 2018, most evident by the default of Infrastructure Leasing and Financial Services (IL&FS) in September last year, the report said. Default by IL&FS, it said, translated into higher borrowing costs and reduced market access for other non-bank financial institutions, leading to domestic regulators to re-examine liquidity norms for the sector and prod banks to increase their lending to, and asset purchases from, such entities. \u201cFitch believes these dynamics will weigh on growth prospects for the sector and likely lead to industry consolidation,\u201d the report said.<\/p>\n","protected":false},"excerpt":{"rendered":"
The debt crisis in IL&FS has adversely impacted growth of the NBFC sector in India and might lead to its consolidation, said a report by Fitch Ratings on shadow banking. Non-banking financial companies (NBFCs) are commonly referred to as the shadow banking sector. The report comes against the backdrop of the Reserve Bank of India\u2019s decision to create a specialised cadre to supervise and regulate the financial sector, including banks and NBFCs. The Indian shadow banking industry\u2019s rapid growth and reliance on short-term funding sources \u201cbubbled over\u201d in 2018, most evident by the default of Infrastructure Leasing and Financial Services […]<\/p>\n","protected":false},"author":39,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[130,197,138],"tags":[],"class_list":["post-275822","post","type-post","status-publish","format-standard","hentry","category-newspapers","category-roads-the-financial-express","category-the-financial-express"],"acf":[],"_links":{"self":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/posts\/275822","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/users\/39"}],"replies":[{"embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/comments?post=275822"}],"version-history":[{"count":0,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/posts\/275822\/revisions"}],"wp:attachment":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/media?parent=275822"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/categories?post=275822"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/tags?post=275822"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}