Bank Unions Demand Repeal Of Nayak Panel Report

Bank unions demand repeal of PJ Nayak committee report-Times of India-01 June 14

AURANGABAD: All India Bank Employees Association (AIBEA) general secretary C H Venkatachalam on Saturday came down heavily on the PJ Nayak Committee report, which suggested increase of private capital in public sector banks and said such move by the government will only destabilize country's economy. The Union, breaking the banking secrecy law, also made public a list of about 400 debtors, who have over Rs 73, 000 crores of bad loans against them.

Reserve Bank of India had appointed a committee under PJ Nayak, the former chairman of Axis Bank, which submitted its report a few days ago, suggesting that the RBI privatize public sector banks (PSB), reduce government capital in PSBs, merge PSBs, transfer ownership of government banks to investment companies and the repeal of the bank nationalization act and the coverage of banks under the companies act, to name a few. The committee also said the government should not release any regulatory instructions to Banks.

Venkatchalam, who is in the city for a two-day national convention said, "The committee report is highly unfair, unwarranted, unjustified, rhetorical and pro-capitalist. It should be scrapped. The health of the public sector banking industry is of prime concern, as a major chunk of the profits is being utilized to write off bad loans running into lakhs of crores of rupees. Today, the total deposits in the banking sector amount to more than Rs 78 lakh crores, while the country's per annum budget is Rs 12 lakh crores. This huge saving needs security, which is provided only by public sector banks and not by the private ones, as many of them have gone bankrupt globally.

He said, "Despite being an independent country for six decades, India is still a developing country, and there are many sectors that are still backward and need attention on a priority basis, including education, employment, women welfare, rural development, health, farming and infrastructure. Public sector banks, if they remain as they are, will be able to extend loan to these sectors, as the private banks are not obliged to extend loans to these sectors.

Vishwas Utagi, vice-president of the AIBEA pointed out that of over six lakh villages in the country, only 40,000 have bank branches, that, too, of public sector banks. He said that almost 5,50,000 of the six lakh villages in India did not have access to banking and could be reached only by public sector banks. Utagi also demanded that banking should be made fundamental right of every citizen."

Devidas Tuljapurkar, the general secretary of the All-India Bank of Maharashtra Employees Federation, came down heavily on the alleged nexus between bank boards and top corporate houses, resulting in bad loans to the tune of lakhs of crores of rupees being written off easily. He also demanded a thorough inquiry in such hefty bad loans.

Jagdish Bhavtankar, another senior comrade and a member at the national body of the bank unions said, "The main challenge faced by the banks today is the increasing amount of bad loans. The bulk of these bad loans are due to corporate houses and industries. It is not wise to allow the same private banks to take over the public sector.
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