##cuts might trigger have made it almost impossible to get banks to embrace restructuring. effectively, there is no right price at which the market for stressed assets clears if left alone to private forces. even with an orderly resolution mechanism such as the insolvency and bankruptcy code in place, why would banks rush to file cases? in the unlikely scenario that assets are in fact being sold by banks to investors at steep discounts, arcs may just asset - strip rather than do the economic turnaround. after all, these investors have waited far too long and now wish to generate quick returns to meet the expectations of their own investors. all this is playing out to near perfection in our setting. its consequences are pernicious. at one end, public sector banks are running balance - sheets that seem to be in a perennial need of recapitalization from its principal owner, i. e., the government, and shying away from lending to potentially healthier industrial credits. bank credit growth has been steadily declining at the stressed banks. some private sector banks face such headwinds too. at the other end, sectors with the most stressed assets have excess capacity relative to current or near - term utilization and no sight of immediate pickup in economic prospects. promoters have continued to operate, staying afloat with rollovers from banks which only increase indebtedness, partly disengaged, partly disgorging cash from the few assets that are running. the end result has been a silent atrophy of the true potential of these assets. this situation should be a cause for concern to all of us. it is reminiscent of weak banks and stagnating growth witnessed by japan in the 1990s, with repercussions to date, and by italy since 2010. japan has experienced, and italy, is in my opinion experiencing, a lost decade. i believe we are at crossroads and have an important choice to make. we can choose status quo, but this would be insanity, “ doing the same thing over and over again and expecting different results, ” as albert einstein put it. it would risk a japanese or an italian style outcome. or we can choose to call a spade a spade as scandinavia did to resolve its banking problems in the early 90 ’ s and the united states did from october 2008 to june 2009, even if only after letting a significant bank fail. ireland and spain, where the recoveries since the global financial crisis have not been as salubrious as in

said5, " - the conduct of supervision is a thankless task, one that is all too likely to tarnish the reputation of the supervisor. the best a supervisor can hope for is that nothing untoward happens. supervisors are only noticed when their actions anger the regulated entities, whether through restrictive or intrusive measures, or when they are criticized after a failure, such as a financial institution collapse or customer harm. despite the discussion around the need for allowing some degree of freedom for institutions to fail, supervisors inevitably face negative press when such events occur, regardless of the circumstances. " be that as it may, to conclude, while the task of supervision may be challenging but it is also essential for ensuring the stability and resilience of the financial system. as supervisors, it is through our vigilance, proactive measures, and continued evolution of supervisory frameworks that we can create a financial environment where institutions not only survive but continue to thrive in the face of emerging risks. as part of our vision for the next decade, rbi @ 100, the reserve bank of india aims to further engage with the central banks of the global south. we are dedicated to 2 / 3 bis - central bankers'speeches establishing a global model of risk - focused supervision, one that emphasizes strong risk discovery and compliance culture, and builds a " through - the - cycle " risk assessment framework. additionally, we are working towards creating a robust data analytics ecosystem to support our supervisory functions, ensuring that our approach remains forward - looking and agile in a rapidly changing world. with these thoughts, i look forward to an engaging and insightful panel discussion that will explore the evolving role of supervision in the face of emerging risks. thank you! 1 masciandaro, d and m quintyn ( 2013 ) " the evolution of financial supervision : the continuing search for the holy grail ", suerf 50th anniversary volume chapters : 263318. 2 a keystone is the wedge - shaped piece at the crown of an arch that locks the other pieces in place 3 mary dowell - jones & ross buckley, reconceiving resilience : a new guiding principle for financial regulation?, 37 nw. j. int'l l. & bus. 1 ( 2017 ). http : / / scholarlycommons. law. northwestern. edu / njilb / vol37 / iss1 / 1 4 principle 8 : supervisory approach of the basel core principles states an effective system of banking supervision requires the supervisor