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Government official says no liquidity crisis

There is a surplus of liquidity in the system and no cause for concern, said a senior official Friday after a meeting between the government and bankers to take stock, especially for financial companies non-bank. The banks said they were buying NBFC portfolios and there was plenty of cash, said a government official, adding that most NBFCs also said they had excess reserves. The failings of the infrastructure development and financing companies IL & FS and its subsidiaries had raised fears of serious repercussions on the credit market, leading to a liquidity crisis.