Read an excerpt from 'What the Economy Needs Now': Raghuram Rajan's thoughts on banking reforms
5 years, 8 months ago

Read an excerpt from 'What the Economy Needs Now': Raghuram Rajan's thoughts on banking reforms

Firstpost  

What the Economy Needs Now is a collection of essays by Indian economists, each tackling an issue facing the country, and providing suggestions for economic growth. Improving governance and management at public sector banks • Public sector bank boards are still not adequately professionalised, and the government rather than a more independent body still decides board appointments — with the inevitable politicisation. • Risk management still needs substantial improvement in public sector banks, regulatory compliance is inadequate and cyber risk needs greater attention. Compensation structures in public sector banks also need rethinking, especially for high-level outside hires. There certainly is a case to experiment by privatising one or two mid-sized public sector banks and reducing the government stake below 50 percent for a couple of others, while working on governance reforms for the rest.

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History of this topic

'Can’t let big biz into banking yet,' says banker Kundapur Vaman Kamath
3 weeks, 5 days ago

'Can’t let big biz into banking yet,' says banker Kundapur Vaman Kamath

New Indian Express  

MUMBAI: Kundapur Vaman Kamath, the veteran banker who led the rapid growth of ICICI Bank and helmed it for nearly two decades from its inception and make the largest private sector lender within few years, has spoken against allowing corporate houses into banking space, saying the regulator has to be satisfied that they will not misuse public deposits through the …

ECONOMIC PERSPECTIVES | Neoliberal dilemma: Public sector banks turn a profit but privatisation not on cards for now
1 year, 7 months ago

ECONOMIC PERSPECTIVES | Neoliberal dilemma: Public sector banks turn a profit but privatisation not on cards for now

The Hindu  

Published : Jun 02, 2023 15:59 IST - 6 MINS READ The government’s economic spokespersons have been celebrating an ostensibly remarkable recovery in the country’s public banking sector. To ensure the solvency of and capital adequacy in banks, the government had to infuse Rs.3,10,997 crore into the public banking system from 2016-17 to 2020-21. Ever since the release of the …

Privatisation Of Banks To Go Forward As Per Schedule: Finance Minister Nirmala Sitharaman
1 year, 7 months ago

Privatisation Of Banks To Go Forward As Per Schedule: Finance Minister Nirmala Sitharaman

ABP News  

Union Finance Minister Nirmala Sitharaman on Monday said the privatisation of public sector banks will go ahead as planned. The minister, while addressing the media on the occasion of the Narendra Modi government completing nine years in power, in Mumbai said, "About the bank privatisation, they will go on as per schedule. "Other than IDBI Bank, we propose to take …

Inside Bank of Baroda’s silent transformation
1 year, 9 months ago

Inside Bank of Baroda’s silent transformation

Live Mint  

In the last week of September 2021, Mukund Rajan, the former chief ethics officer at the Tata Group, showed a bunch of Bank of Baroda executives a video clip from the 26/11 terror attacks in Mumbai. Led by Sanjiv Chadha, the bank’s current managing director and chief executive officer, the lender is on a mission to reinvent itself by adding …

Unfinished agenda: Long-standing debate on privatisation of state-run banks resurfaces
2 years, 4 months ago

Unfinished agenda: Long-standing debate on privatisation of state-run banks resurfaces

The Hindu  

Published : Sep 08, 2022 11:00 IST The long-standing debate on whether India’s public sector banks should be privatised has resurfaced in recent days. Referring to a core theme in the article by Gupta and Panagariya, the RBI researchers argued that while on pure profitability grounds private banks in India appear more efficient than public ones, public banks turn out …

RBI Issues Clarification On PSB Privatisation Report, Says Bulletin Article Doesn't Represent Its View
2 years, 4 months ago

RBI Issues Clarification On PSB Privatisation Report, Says Bulletin Article Doesn't Represent Its View

ABP News  

The Reserve Bank of India on Friday clarified issued a clarification saying that the views expressed in its recent article, ‘Privatisation of Public Sector Banks: An Alternate Perspective’, do not represent the views of the central bank and are of the authors. The article appeared in the monthly bulletin arguing against a big bang approach to public sector banks privatisation. …

RBI Bulletin: Big bang Approach To PSB Privatisation May Do More Harm Than Good
2 years, 4 months ago

RBI Bulletin: Big bang Approach To PSB Privatisation May Do More Harm Than Good

ABP News  

A big bang approach to privatisation of state-run banks may do more harm than good, according to the latest Reserve Bank of India bulletin released on Thursday. The RBI’s paper showed some of the major reasons that public sector banks can serve the country better than private banks include better financial inclusion, better credit system, and better efficiency of the …

Fact Check: No, the Centre is NOT privatising all public sector banks except SBI!
2 years, 4 months ago

Fact Check: No, the Centre is NOT privatising all public sector banks except SBI!

India Today  

Ever since Finance Minister Nirmala Sitharaman proposed to take up the privatisation of two public sector banks in her Budget speech for the fiscal year 2021-22, the issue has been widely debated. AFWA PROBE While investigating the claim, we found a report by The Times of India from July 12, according to which, a policy paper of the Indian Policy …

Advance Action Underway On Privatisation Of State-Run Banks, Says DFS Secretary
2 years, 7 months ago

Advance Action Underway On Privatisation Of State-Run Banks, Says DFS Secretary

ABP News  

New Delhi: Advance action is underway for privatisation of two public sector banks in pursuance of the announcement made by finance minister Nirmala Sitharaman, Department of Financial Services Secretary Sanjay Malhotra said on Monday. In the Union Budget for 2021-22, the government announced its intent to take up the privatisation of two PSBs in the year and approved a policy …

Bank Privatisation: Central Bank of India, Indian Overseas Bank May Be Privatized This Fiscal
3 years, 7 months ago

Bank Privatisation: Central Bank of India, Indian Overseas Bank May Be Privatized This Fiscal

News 18  

The Centre could privatise the two-state run banks — Central Bank of India and Indian Overseas Bank soon, according to report by Times of India. NITI Ayog, the government think-tank has recently submitted a report to the core group of secretaries on Disinvestment mentioning the names of the two banks the would be privatised this fiscal, news agency PTI mentioned. …

Engaging With RBI on Privatisation of Govt-Run Banks in Big Way, Can't Have Laggards: Nirmala Sitharaman
3 years, 11 months ago

Engaging With RBI on Privatisation of Govt-Run Banks in Big Way, Can't Have Laggards: Nirmala Sitharaman

News 18  

Finance minister Nirmala Sitharaman on Monday told the News18 Network that the government had engaged with the Reserve Bank of India in a “big way” as she outlined a timeline for meeting divestment targets set in her Budget 2021 speech. Speaking to News18 Network’s Editor-in-Chief Rahul Joshi, the finance minister said that the country needs efficient banks for the economy …

Rajan, Acharya may be off mark: PSU banks need strategy and focus to survive, not privatisation as remedy
4 years, 3 months ago

Rajan, Acharya may be off mark: PSU banks need strategy and focus to survive, not privatisation as remedy

Firstpost  

The PSU banks’ problem is often linked to India’s burgeoning fiscal deficit that needs control because pumping taxpayer money into state-run banks is fraught with risks. It is interesting that two of India’s biggest brand-name economists, former Reserve Bank governor Raghuram Rajan and former deputy governor Viral Acharya, have spoken for the “re-privatisation” of public sector banks even as the …

'Privatise Select PSU Banks, Dilute Role of DFS': Raghuram Rajan Calls for Reforms
4 years, 3 months ago

'Privatise Select PSU Banks, Dilute Role of DFS': Raghuram Rajan Calls for Reforms

News 18  

Former RBI Governor Raghuram Rajan on Monday suggested the government to privatise select public sector banks, set up a bad bank to deal with NPAs and dilute the role of Department of Financial Services. “Winding down Department of Financial Services in the Ministry of Finance is essential, both as an affirmative signal of the intent to grant bank boards and …

Need to Divest Stakes in Public Sector Banks in Graceful Manner, Says RBI Ex-Deputy Governor Viral Acharya
4 years, 5 months ago

Need to Divest Stakes in Public Sector Banks in Graceful Manner, Says RBI Ex-Deputy Governor Viral Acharya

News 18  

Former RBI Deputy Governor Viral V Acharya on Friday cautioned against fire sale of state-owned lenders, saying that disinvestment should be undertaken in a graceful manner at the right price and also made a case for privatisation of some healthy public sector banks. Divestment beyond majority stake is the first step because it will help relax the fiscal constraint in …

Yes Bank crisis: Best practices needed as benchmark to govern banks; govt should consult with veteran bankers for solutions
4 years, 10 months ago

Yes Bank crisis: Best practices needed as benchmark to govern banks; govt should consult with veteran bankers for solutions

Firstpost  

Recent days have seen RBI governor Shaktikanta Das pulling up public sector banks for poor credit growth even as Kapoor’s Yes Bank shenanigans were simmering in the backdrop. The current crisis in Yes Bank makes for great headlines, with a high-profile founder lending huge amounts to tainted and/or serial borrowers, allegations of political corruption and a general state of injustice …

Niti Aayog VC pitches for governance reforms in banking sector
5 years, 3 months ago

Niti Aayog VC pitches for governance reforms in banking sector

India TV News  

Niti Aayog Vice Chairman Rajiv Kumar on Friday called for further reforms in banking sector after the recent recapitalisation and mergers, saying banks need autonomy and work at arm's length from the government. Speaking here at the India Economic Summit, Kumar also said the government must consider tapping capital markets and raise long- term funds for creating long-term assets through …

Nationalisation of banks: Govt can continue to own banks, but management must be made professional
5 years, 5 months ago

Nationalisation of banks: Govt can continue to own banks, but management must be made professional

Firstpost  

Also, the PSBs have taken up technology quite well with core banking now virtually omnipresent. The nationalisation of banks was probably one of the boldest steps taken by the government in 1969 as the decision had many motives including bringing about balanced economic development and resolving the unemployment issue. Notwithstanding the fact that the PSBs today have the negatives of …

State-run banks should be freed of constraints, says Raghuram Rajan
5 years, 6 months ago

State-run banks should be freed of constraints, says Raghuram Rajan

Live Mint  

Public sector banks might perform better if they are freed from some of the constraints they operate under but such freedom typically requires distance from the government, says former Reserve Bank of India governor Raghuram Rajan. "Certainly, if public sector banks are freed from some of the constraints they operate under they might perform far better," he says. There certainly …

PSB recapitalisation: Why Narendra Modi govt must look at outright privatisation of state-run banks rather than experimenting with taxpayers' money
5 years, 6 months ago

PSB recapitalisation: Why Narendra Modi govt must look at outright privatisation of state-run banks rather than experimenting with taxpayers' money

Firstpost  

There are reports indicating that the Union Government is contemplating recapitalising the public sector banks with a capital of Rs 30,000 crores. Thus, to a layman, this situation should give rise to the question as to why then is the government continuously infusing taxpayers hard-earned money into the banking system. The government controls more than two-thirds of the banking assets …

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