Panel to clean up financial sector laws soon: Mukherjee

NEW DELHI - The government will soon set up a commission to rewrite and clean up financial sector laws, in a bid to make them more relevant to the changed economic scenario, Finance Minister Pranab Mukherjee said Friday.

“The government has decided to set up a financial sector legislative reforms commission (FSLRC) to rewrite and clean up the financial sector laws and bring them in line with the requirements of the sector, Mukherjee said at a Canara Bank event here.

He said to strengthen and institutionalise the mechanism for maintaining financial stability and to address certain regulatory concerns, the government has also decided to set up an apex-level financial stability and development council (FSDC).

“The ongoing reforms should help further strengthen and stabilise the financial sector, he said.

The finance minister asked banks to properly manage their non-performing assets (NPAs) and pay due attention to their balance sheets.

“Care should be taken to ensure that there is no further deterioration of the asset quality as reflected by the increase in the proportion of doubtful and loss assets in the NPA portfolio of banks in 2009-10, he said.

“At the same time, banks should meet the additional provisioning norms to provide a cushion against asset slippages while maintaining profitability, Mukherjee added.