RBI canĀ“t always bail out Banks should not be surprised when there is a sharp rise in bond yields. Rather, they should āknow and understand this risk rather well,ā said Reserve Bank of India (RBI) Deputy Governor Viral Acharya (pictured) to the association of bond investors, most of them being from banks.āInterest rate risk of banks cannot be managed over and over again by their regulator,ā Acharya said on Monday, delivering as tern message to banks. āThe regulator, in the interest of financial stability, is caught in such situations, between a rock and a hard place, and often obliges.ā However, by taking advantage of the dispensation regularly, efficient price discovery in the government securities (GSec) market and effective market discipline on the GSec issuer was not happening. āNor does it augur well for developing a sound risk management culture at banks.ā The comment comes at a time when banks have been lobbying with the central bank to allow spreading their treasury l...