Cost To Guard Bank Bonds Drop As India Bad Loan Risk Ebbs

Indian bank credit default swaps are hovering near multi-year lows as the government takes steps to solve the problem of bad loans that's restraining the economy.

The price to protect the debt of State Bank of India has fallen to near the lowest level since 2011, and the cost to insure ICICI Bank Ltd.'s bonds is close to a decade-low, according to data compiled by Bloomberg.

The Cabinet on Wednesday cleared a proposal giving more powers to the central bank to tackle the world's worst stressed-asset ratios, a move that may help speed up its resolution, analysts including CreditSights' Ben You Ang said.

Also Read: Empowering RBI To Clean Up The Bad Loan Mess. Will It Work?