Economics · Banking and Finance
Scenario: A public sector bank has a high level of stressed assets worth ₹50,000 crore. The government proposes to transfer these assets to a special purpose vehicle to clean the balance sheet. Which of the following best describes this mechanism?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Bad Bank mechanism for asset reconstruction✓
- 2Merger of weak banks
- 3Priority sector lending adjustment
- 4Direct capital infusion by RBI
Correct answer
Bad Bank mechanism for asset reconstruction
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