Letters to Editor – The Hindu BusinessLine


SVB fiasco

This refers to ‘SVB shows up old systemic flaws’ (March 17). The financial world is passing through a critical phase with the collapse of Silicon Valley Bank and the recent developments in Swiss-based Credit Suisse. Asset-liability mismatch, concentration risk, too much exposure to treasury/mortgage bonds, etc., had contributed to the downfall of SVB.

Though US-Fed as a regulator should have monitored the developments from time to time, it is the inactivity on the part of internal management and the so-called ‘gatekeepers’ that had led to the SVB fiasco.

While it’s claimed that SVB had met basic capital adequacy requirements as set by the Basel committee, its collapse raises questions on the monitoring capacity of the internal risk team.

Srinivasan Velamur


Regulating fintechs

With reference to “Falling in line” (March 17), it is noteworthy that RBI’s digital lending guidelines have brought in the much-needed operational discipline among fintechs.

However, the mandatory compliance of tie-up requirement of fintechs with licensed banks and NBFCs for lending support warrants them to follow the policy guidelines in respect of due diligence and collection of charges which the regulated original lenders compulsorily adhere to under the extant RBI guidelines in force.

This may be a deterrent to the sustainability of fintechs.

Sitaram Popuri


Dietary supplements

This refers to ‘FSSAI mulls guidelines on use of health supplements, nutraceuticals’ (March 17). The easy availability of these dietary supplements over the counter and online has led to their indiscriminate and rampant use. FSSAI needs to come out with detailed guidelines backed by scientific research and has to be more vigilant in the interest of the health of millions who are consuming these health supplements, with or without guidance and supervision. The quality of these products needs to be ensured and should be sold along with guidelines on their usage and warning about the adverse health consequences of consuming without guidance and supervision.

Kosaraju Chandramouli


Merger of banks

Apropos ‘Time to consolidate old private banks’ (March 17), the focus is on the size of a unit and so the article recommends merger of old private banks. Today, size matters for financial experts. Otherwise, how does one explain the merger of ‘big’ banks in the public sector banks space. It’s a different matter customer service has deteriorated for the common man. All the old private sector banks referred to are niche banks in their own way. Small businesses and retail customers are happy with these banks. In fact, ‘small is beautiful’ for them.

KV Rao


Time to consolidate

Since Independence, the government and the RBI have been periodically reviewing the institutional system in the financial sector and making necessary changes. Resultantly, different categories of banks and financial institutions came into being. Time is now ripe for consolidation and integration of the entire financial sector doing the business of banking without causing hardship to any stakeholders including employees and the customers.

MG Warrier