“While we seek more autonomy for the banks, we from the industry must also set certain standards for us for ensuring clean and best banking and business practices
GN Bureau | February 19, 2018
The Punjab National Bank's fraudulent transactions worth Rs 11,300 crore should act as a strong trigger for the government for reducing its stake to less than 50 percent in the banks which should then be allowed to work on the lines of private sector lenders with a full sense of accountability to their shareholders protecting interest of depositors, the Assocham said.
"The PSU banks, ironically, are slipping from one crisis to the other and there is a limit the government can keep bailing them out at the cost of taxpayers' money, even if it is the principal shareholder in these lenders,” it said.
“The top banking positions are treated as extension of a government job and the senior most management spend bulk of their quality time, receiving and implementing directions from the bureaucrats even for innocuous issues. In the process, the core banking functions, including all important risk mitigation and management, take a back seat. The problem has become more grave with the banking adopting to new technologies which can prove both boon and bane, depending on how effectively they are implemented,” an official statement from Assocham read.
Once the government equity in the banks is reduced below 50 percent, there would be much more autonomy along with accountability and responsibility of the senior management. The boards should then be truly taking the policy decisions while the CEOs would run the banks with full authority, coupled with the commensurate responsibility, instead of looking towards the bureaucrats for directions.
Assocham general secretary DS Rawat said, “There is an onus on India Inc as well. There are two sides of a coin. If one side represents the bank managements, the other side, which involve the borrowers, represents India Inc. Any unsavoury incident leaves both sides of the coin smudged. It is time the industry also did some introspection. While we seek more autonomy for the banks, we from the industry must also set certain standards for us for ensuring clean and best banking and business practices.”
He called upon the Reserve Bank of India to take a lead and engage with the industry in finding ways to do a clean business in the entire financial sector, be it the public sector or private sector banks or even the non-banking finance companies.
In the face of the Covid-19 pandemic, people of India have realized their collective strength, prime minister Narendra Modi said in a short video message Friday morning. He also urged people to light lamps Sunday night as a gesture of this collectivity. “Today marks nine days of the na
Demobilization, like its predecessor – demonetization, is another decision gone bad in implementation. In both instances a careful public administrative action through its governance systems could have saved the magnitude of impact particularly on the most vulnerable sections of the society. Th
In a bid to break the “chain of transmission” of the deadly Covid-19, India, a country with more than 1.3 billion population, observed a voluntary ‘Janata Curfew’ on March 22. This has been followed by a 21-day, nationwide lockdown from March 24. Prime minister Narendra Modi also re
To take speedy decisions on research and development for Sars-Cov-2 virus and COVID-19, the government has constituted a Science and Technology Empowered Committee. The committee, set up on March 29 and chaired by Niti Aayog member, professor Vinod Paul and professor K Vijay Raghavan, princi
Covid-19 may turn out to be the last straw that broke the camel’s back so far as the real estate sector is concerned. It broke out at a time when pundits were estimating the GDP to be hovering around 2.5% with unprecedent levels of unemployment. This itself was a good indicator that the real estate s
As COVID -19 cases continue to rise amid a 21-day lockdown, the centre and the states are proactively taking measures to provide aid to the underprivileged and the needy during this unprecedented situation. By Sunday morning, India had registered 27