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Government may reduce stake in banks to 52 percent: Jaitley

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By NewsGram staff writer

Mumbai: Finance Minister Arun Jaitley, regarding the concerns about levels of non-performing assests (NPAs) or bad debts, of public sector banks, said that government may consider reducing its stake in them to 52 pre cent.

Addressing the annual meeting of Indian Banks’ Association here, he also said state-run banks have to be freed from political interference in decision-making and their decisions should be based only on banking merits.

“Efforts are on to give shape the banking bureau and to professionalize all personnel issues. We are willing to look at changes. We have appointed a panel headed by Justice AP Shah to find options of hiring best quality talent,” he said.

Taking the first step towards a holding company structure for state-run banks, the government last month announced the setting up of a Banks Board Bureau (BBB) that will recommend appointment of directors in PSBs and advice on ways of raising funds and dealing with issues of stressed assets.

Jaitley has allocated Rs.7, 940 crore in the budget for recapitalization of public sector banks in this fiscal.

In December, the union cabinet had allowed state-run banks to raise up to Rs.160, 000 crore from the capital markets by diluting the government stake in phases to 52 percent.

As per an estimate, public sector banks would need additional capital of up to Rs.240, 000 crore by 2018 to meet the Basel III capital adequacy norms, put in place to guard against a repeat of the situation following the 2008 US financial crisis.
Jaitley also said the government was getting ready to unveil a draft for a bankruptcy code by early October.

“The bankruptcy code draft will be put out by early next month and would be taken to parliament from there. Resolution of disputes with relation of contracts law will be passed by the end of the fiscal,” he said.

 

(With inputs from IANS)

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Harsh Penal Proceedings For Illegal Swiss Bank Deposit Holders: Arun Jaitely

A news item has appeared today indicating an increase of money by ‘Indians’ in the Swiss banking system

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Harsh Penal Proceedings For Illegal Swiss Bank Deposit Holders: Arun Jaitely
Harsh Penal Proceedings For Illegal Swiss Bank Deposit Holders: Arun Jaitely. flickr

Union Minister Arun Jaitley today warned that Indians having illegal deposits in Swiss banks would face harsh penal proceedings under the black money law after Switzerland starts real time sharing of details of accounts from January onwards. Latest data from the Swiss National Bank showed that money parked by Indians in Swiss banks rose over 50 per cent to CHF 1.01 billion (Rs 7,000 crore) in 2017, reversing a three-year downward trend amid India’s clampdown on suspected black money stashed by its citizens overseas.

“A news item has appeared today indicating an increase of money by ‘Indians’ in the Swiss banking system. This has led to misinformed reaction in certain circles raising a query whether the government’s anti-black money steps have yielded results,” Jaitley said in a blog. Noting that Switzerland in financial disclosures was always a reluctant state, Jaitley said the Alpine nation has amended its domestic laws involving all disclosures and entered into a treaty even with India and real time flow of information with regard to Indians would be made. “The flow of information is starting in January, 2019. Any illegal depositor knows that it is a matter of months before his name becomes public and he will be subjected to the harsh penal provisions of the black money law in India,” said the senior BJP leader and an eminent lawyer.

Jaitley said the Alpine nation has amended its domestic laws
Jaitley said the Alpine nation has amended its domestic laws. Flickr

Also read: Under Arun Jaitley corruption grew manifold in DDCA: Bishan Singh Bedi

Further, Jaitley said those who participate in a public discourse must understand these basic facts before expressing an opinion which may be ill-informed. “To assume that all the deposits are per se tax evaded money or that Switzerland in the matter of illegal deposits is what it was decades ago, is to start on a shaky presumption,” he added. (IANS)