The financial crisis of 2008 was followed by a fiscal stimulus that buoyed growth. However, since 2012-13 for a variety of reasons including the sharp decrease in credit, withdrawal of the stimulus, and other shocks to the economy, growth has been tepid at best. Today the problems with the financial sector loom large.   Capital investment are yet to revive. Infrastructure financing has proved to be particularly problematic for bigger banks, especially for public sector banks. The real estate quagmire has not yet lifted.  

Public sector banks are also faced with the difficult task of protecting their organizational boundaries from dysfunctional influences. The crisis is an opportunity for them to set right organizational structure and processes that may have stood against task performance in the past. Systems and processes and internal accountability are the key factors in such organizational strength. Private sector banks could use the opportunity to increase their market shares especially as the economy revives.

The emergence of newer modes of payment and transfer, FINTECH, the ubiquitous social media, pervasiveness of IT and big data, need recognition and a studied response. Regulatory changes have brought in newer players into the business and have put pressure on banks and FIs to worry about their product-market choices. Business as usual is not an option. The key to being responsive is leadership that is able to change organizational structures and processes, to take advantage of the opportunities in the market.  For PSU Banks and FIs, additionally, much would depend upon their ability to negotiate the requisite autonomy for task performance. Similarly, in a situation of policy flux, the ability to articulate and react to policies and frameworks for the evolution and transformation of the sector would be important.