Over time, such warped economics has bred inefficiency, has misdirected scarce economic resources and has encouraged gross mismanagement of companies in total violation of fiduciary management principles.

The result has been unpalatable: rampant corporate misgovernance, destruction of shareholder values, consistent non-performance and at times even criminal acts.

All these have to stop, at once. FIs should play an active role in creating a market for corporate control and in encouraging shareholder value-adding mergers and acquisitions. They need to tell the promoters in no uncertain terms that in the event of mismanagement, they would not hesitate to sell their stakes.