Cabinet Secretary-led panel holds crucial meeting on bank privatisation
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Central Bank of India and Indian Overseas Bank are reported to be possible candidates for privatisation.
Inching a step nearer to privatisation of two public sector banks, a high-level panel headed by the Cabinet Secretary held a meeting to thrash out the regulatory and administrative points in order to position the proposal with the group of ministers on disinvestment or Alternative Mechanism (AM) for approval.
Pursuant to the announcement made by Finance Minister Nirmala Sitharaman in her 2021 finances speech, the NITI Aayog has recommended the names of a few banks for privatisation to the Core Group of Secretaries on Disinvestment headed by the Cabinet Secretary in April, sources mentioned.
The high-level panel meeting mentioned the suggestions of the NITI Aayog on June 24, sources mentioned, including, it could ship the names of the shortlisted PSU banks to AM for consideration after tying up all of the free ends.
Headed by the Cabinet Secretary, the members of the panel embody secretaries of Economic Affairs, Revenue, Expenditure, Corporate Affairs, Legal Affairs and the Administrative departments. The panel additionally has the Department of Public Enterprises, Department of Investment and Public Asset Management (DIPAM) secretary as its member.
According to sources, the panel additionally examined points pertaining to the safety of pursuits of staff of the banks more likely to be privatised.
Following a clearance from AM, it can go to the Union Cabinet headed by the Prime Minister for the ultimate nod. Changes on the regulatory aspect to facilitate privatisation would begin after the Cabinet approval.
Central Bank of India and Indian Overseas Bank are reported to be possible candidates for privatisation.
The authorities has budgeted ₹1.75 lakh crore from stakes sale in public sector corporations and monetary establishments, together with two PSU banks and one insurance coverage firm, throughout the present monetary 12 months. The quantity is decrease than the report budgeted ₹2.10 lakh crore to be raised from CPSE disinvestment within the final fiscal.
In her Budget Speech on February 1, Ms. Sitharaman had introduced that the federal government proposes to take up the privatisation of two public sector banks (PSBs) and one basic insurance coverage firm within the 12 months 2021-22.
“Other than IDBI Bank, we propose to take up the privatisation of two public sector banks and one general insurance company in the year 2021-22,” she had mentioned.
The authorities final 12 months consolidated 10 public sector banks into 4 and in consequence, the entire variety of PSBs got here right down to 12 from 27 in March 2017. The authorities has merged 14 public sector banks within the final 4 years.
Last 12 months, in April, the federal government effected the most important ever consolidation train within the public sector banking house when six PSU lenders had been merged into 4 in a bid to make them globally aggressive.
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