India banks feel the heat; Why some kids can handle the pressure; Fewer marriages in South Africa

1 India banks feel the heat (Kunal Kumar Kundu in The Wall Street Journal) Indian banks’ non-performing assets are on the rise. The sector is feeling the effects of slowing economic growth, a tight monetary policy regime, and the stalling of big-ticket investments. At the end of last financial year, gross non-performing assets in the Indian banking system were close to 3% (of gross advance), the highest in six years, Reserve Bank of India data show. The trend has worsened this year.

As of Sept. 30, the gross non-performing assets of Indian banks rose by nearly 46% (530 billion rupees, or roughly $10 billion) from a year earlier, says a study by NPA resource.com. Gross advances – total advances made by the banking sector – grew by less than 16% in the same period. If non-performing assets rise faster than advances, the profitability of banks declines.

Fitch Ratings has warned that the gross non-performing assets of the Indian banking system will be as high as 4.2% of advances this financial year. That would be the highest since 2004-05, when the ratio stood at 5.2%. Rising non-performing assets lead to higher provisioning requirements for banks. This impacts banks’ profitability and also their capital adequacy ratio, restricting their ability to grow.

As of Dec. 31, the total amount of loans (on a cumulative basis) restructured by Indian banks under the corporate debt restructuring mechanism was 2.12 trillion rupees, an increase of 245.84 billion rupees from the start of October. For banks, restructuring leads to increased cost of credit as they need to set aside a higher percentage of the original loan amount.

2 Why some kids can handle the pressure (Po Bronson & Ashley Merryman in The New York Times) Never before has the pressure to perform on high-stakes tests been so intense or meant so much for a child’s academic future. As more school districts strive for accountability, standardized tests have proliferated. The pressure to do well on achievement tests for college is filtering its way down to lower grades, so that even third graders feel as if they are on trial.

Students get the message that class work isn’t what counts, and that the standardized exam is the truer measure. Sure, you did your homework and wrote a great history report — but this test is going to find out how smart you really are. Critics argue that all this test-taking is churning out sleep-deprived, overworked, miserable children.

But some children actually do better under competitive, stressful circumstances. An emerging field of research — and a pioneering study from Taiwan — has begun to offer some clues. Like any kind of human behavior, our response to competitive pressure is derived from a complex set of factors — how we were raised, our skills and experience, the hormones that we marinated in as fetuses. 

There is also a genetic component: One particular gene, referred to as the COMT gene, could to a large degree explain why one child is more prone to be a worrier, while another may be unflappable, or in the memorable phrasing of David Goldman, a geneticist at the National Institutes of Health, more of a warrior.

3 Marriages drop in South Africa (Sowetan) Lifestyle changes among South Africans have contributed to fewer marriages, particularly customary marriages, the SA Institute of Race Relations said.  Between 2003 and 2010, the number of civil as well as customary marriages registered every year declined by 8%, said researcher Thuthukani Ndebele.

Using figures from Stats SA, Ndebele said the decline in customary marriages was considerably more pronounced than that of civil marriages. "Customary marriages dropped by 42% from 17,283 registered in 2003 to 9,996 in 2010. Civil marriages decreased by 4% from 178,689 to 170,826."

He said the lifestyle choices among black people, such as getting married at a "later stage" and cohabitation outside of marriage, now had less stigma attached to them. "It's not that people are not getting married at all, but for example in urban areas there is a lot of cohabitation...," said Ndebele. He said the number of households was going up while the average household size was shrinking, which suggested that more people preferred to live on their own or with their unmarried partners.