RBI Governor Wants Bankruptcy Code

India’s Sisyphean system for bankruptcy is in the sights of the country’s central bank governor, who says reform is desperately needed to protect state-owned banks.

“We want to bring pure capitalism back, which is a contract is a contract,” Raghuram Rajan, governor of the Reserve Bank of India (RBI), told CNBC in an exclusive interview. “That’s what we’re in the process of doing by giving the banks a few more powers and asking them to enforce their contracts.”

Without that, companies don’t fear resolution and instead put the squeeze on banks to bail them out, he said.

via CNBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza