First, loans went kaput and borrowers left the country after defaulting on payments or committing frauds, then high-profile bankers were forced to leave and even the top central banker quit in the end -- 2018 was indeed a 'Year of Exits' for the banking sector.
In the meantime, the sector continued to sit on the mount of NPAs even as efforts continued in courts and tribunals and other forums for recovery of stressed assets, further confounded by defaulting promoters of defaulting corporates coming back to reclaim their assets when they were put on sale by aggrieved lenders.
The eventful year began with lid being taken off from the country's biggest ever banking fraud. Billionaire diamantaire Nirav Modi and his uncle Mehul Choksi, in connivance with certain bank officials, allegedly cheated state-run Punjab National Bank (PNB) of about Rs 14,000 crore through issuance of fraudulent letters of undertaking.
A Mumbai branch of PNB had fraudulently issued LoUs for the group of companies belonging to Modi since March 2011 and there were hundreds of such LoUs. The magnitude of the scam shook the entire banking system and PNB is still trying to overcome this.
As intricacies of the Nirav Modi scam were still unfolding, a whistle-blower in March raised issue of impropriety against Chanda Kochhar, the then managing director of the country's largest private sector lender ICICI Bank that for long had been a showcase institution where nothing can go wrong.
The 56-year-old Kochhar, who rose through ranks to occupy the corner office of the prestigious institution, was mired in allegations of conflicts of interest, lack of disclosures and quid-pro-quo while extending loans to the now-bankrupt Videocon Industries.
Subsequently, another complaint was filed against her and she had to eventually to say goodbye in October to the bank which she had joined as a management trainee in 1984.
As regulatory and internal probes continued, the bank and Kochhar denied any wrongdoing.
Another high-profile banker Shikha Sharma was denied extension by the RBI as managing director of Axis Bank, the third largest private sector lender. The bank's board had proposed another three-year term for her till May 2021, but she was allowed to serve only till December 31, 2018.
Another exit story continues to play out at Yes Bank, where Rana Kapoor's tenure as CEO has been curtailed by the Reserve Bank of India and he has been allowed to occupy the position only till January 31, 2019. The lender also saw Ashok Chawla quitting as its chairman last month.
However, the biggest of the exits took place at the RBI itself with Governor Urjit Patel announcing his sudden resignation with immediate effect on December 10 citing "personal reasons". The resignation, however, followed a run-in with the government over several issues including autonomy of the central bank.
The very next day, the government appointed former bureaucrat Shaktikanta Das as the new RBI chief.
In case of both Axis Bank and Yes Bank, the RBI had flagged problems with their assets.
Axis Bank's NPAs jumped over five-fold in two years till March 2017, while the net profit halved in the same period. It saw its gross bad loans ratio rise to 5.04 per cent by March 2017, from 0.96 per cent in March 2009, when Sharma had taken charge.
Several lenders, including Yes Bank, were asked by the RBI to disclose 'divergences' in their bad loan reporting. The central bank judged gross NPAs at Rs 8,373.8 crore at Yes Bank for 2016-17, as against the declared gross NPAs of Rs 2,018 crore.
As a promoter, Kapoor and his family own 10.66 per cent stake in the bank, which is now actively searching for his replacement as CEO.
In the public sector banking space, the fight continued against non-performing assets (NPAs) and the situations remains far from the normal.
The gross NPAs peaked in March and have shown some moderation of nearly Rs 23,860 crore in the first half of the current financial year (April-September 2018) to Rs 8,71,741 crore. It stood at Rs 8,95,601 as on March 2018.
The loss of public sector banks widened further to Rs 4,532 crore in the quarter ended October 2018, from Rs 4,285 crore in the same quarter a year ago indicating pressure from NPAs on their bottom-line.
Financial Services Secretary Rajiv Kumar, however, pointed out the record recovery of Rs 67,026 crore in the first half of the current financial year, which was more than double the amount recovered in the first half of the last fiscal and nearly same as Rs 67,107 crore recovered during the whole of the preceding financial year.
He asserted significant further recovery is expected going forward as a number of high-value accounts are at advanced stages of the resolution process in the National Company Law Tribunal.
During the year, the government also approved the stake sale of IDBI Bank to LIC.
As part of the consolidation process, the government also announced merger of Bank of Baroda, Vijaya Bank and Dena Bank to create a global-sized lender which will be "stronger and sustainable". With combined business of Rs 14.8 lakh crore, it will be the country's third largest bank after state-run SBI and the private lender ICICI Bank.
The new entity will have also better financial strength with net NPA ratio of 5.7 per cent, which is significantly better than the overall public sector bank average of 12.1 per cent.