SAVE PUBLIC SECTOR BANKS
Dear friends,
Banking system in India is carefully studied under two categories as per the service rendered by the Banking sector to the common man of this country. They are Pre Independence Phase [1786-1947] and Post Independence phase [1947 till date].
The banking facility for the people of India during the Pre independence period and Post independence period shows two different poles of managerial and administrative approach.
The unique identity of the common man during the Pre independence period was the socio- economic exploitation. Though these two approaches show various positive and negative developments for the Indian economy, the expectation of the people is to get rid off from these socio-economic exploitations from those capitalistic sector, prevalent during the Pre independence era.
Because, the economic exploitation of the peoples during the Pre-independence period were the symptoms of socio-economic atrocities against the common man by those capitalistic dominance.
Due to this exploitative situation, people were keen to tap an alternate institutions through which their economic standard was getting uplifted.
The development of Banking system during Pre independence Period was derived from ancient Vedic period. During the Pre independence period the main objective of the banking system was meant for serving the highest business society only, with the support of the rulers.
The colonization made the banking system to serve for the purpose of developing the business of an individual capitalists. From that stage, banking system was emerged due to swadeshi movement in India for serving the people of India.
Thus shifting of banking industry from an unilateral service to multi focal services. We can understand the growth of our banking industry with the intensified contribution of our people. At the same time, people harvested the benefit of the growth of Banking industry vide various social schemes.
Though these schemes were initiated by the government, implementation, and the end use were assured by our PSB. Thus growth of the PSB and the people were achieved simultaneously.
From the following paragraphs we can understand that PSB and the people are inseparable.
DEVELOPMENT OF BANKING IN PRE INDEPENDENCE PHASE
Banking in India, in the modern sense, originated in the last decades of the 18th century. Among the first banks were the Bank of Hindustan, which was established in 1770 and liquidated in 1829–32; and the General Bank of India, established in 1786 but failed in 1791.
The period between 1906 and 1911 saw the establishment of banks inspired by the Swadeshi movement. The Swadeshi movement inspired local businessmen and political figures to establish banks of and for the Indian community.
A number of banks established then have survived to the present such as Catholic Syrian bank,The South Indian bank, Bank of India, Corporation Bank,Indian Bank, Bank of Baroda, Canara Bank, and central Bank of India.
The fervour of Swadeshi movement led to the establishment of many private banks in Dakshina kannada and Udupi district, which were unified earlier and known by the name South Canara (South Kanara) district.
Four nationalised banks started in this district and also a leading private sector bank. Hence undivided Dakshina Kannada district is known as "Cradle of Indian Banking".
During the First World war (1914–1918) through the end of the Second World war (1939–1945), and two years thereafter until the independence of India were challenging for Indian banking. The years of the First World War were turbulent, and it took its toll with banks simply collapsing despite the Indian economy gaining indirect boost due to war-related economic activities. At least 94 banks in India failed between 1913 and 1918.
Bank of Calcutta was started in June 1806. In 1809, it was renamed as the Bank of Bengal. This was one of the three banks funded by a presidency government, and the other two were the Bank of Bombay in 1840 and the Bank of Madras in 1843.
The three banks were merged in 1921 to form the Imperial Bank of India, which upon India's independence, became the State bank of India in 1955. These small mergers were planned for the better administrative purposes only.
For many years the presidency banks had acted as quasi-central banks, as did their successors, until the Reserve Bank of India was established in 1935, under the Reserve bank of India Act 1934.
STATUS OF BANKING SECTOR IN PRE INDEPENDENCE PHASE
The Indian banking system at the time of independence was under Private ownership. The rural population of the country had to depend upon money lender for their requirement. A huge number of people lost their life’s earnings. The common man had no access to banking facilities, and the PARTICIPATION OF RURAL POPULATION WAS NIL.
Growth of Private sector banks during this period was massive and paved ways for a unilateral capitalism. It was found that the private sector banks in the country did not provide the required credit disbursal support, especially to the unorganized sector.
We have our major portion of our human resources in this unorganized sector from our Rural back ground that is back bone of our country. The unorganized sector consisting of farmers, small scale industries, transporters, self-employed and professionals had to largely depend on private moneylenders who exploited them with extremely high interest rates.
During this period, class banking was prominent rather than supporting the rural mass. A massive shifting was required at that time from CLASS BANKING TO MASS BANKING to bring Banking facilities at the door steps of the rural peoples to protect them from economic exploitation from local money lenders and to safeguard the hard earned money of those rural peoples.
This has led the government to turn their attention towards ‘TO PROTECT THE PUBLIC MONEY AND TO SERVE THE GROSS ROOT RURAL MASS AGAINT ECONOMIC EXPLOITATION”. Because, the government realized that banking industry only can serve for the upliftment of our Indian economy and serve the people of India.
Thus, pre independence period also witnessed that, Banking industry is paramount for the Indian economy. But the private sector banks were working on the basis of profit making only without the conscious of serving the people. Government realized that Public sector Banking only can serve both for the upliftment of our Indian economy and the people of India.
People of India were also keen to accept a strong public sector forum, by which these ill effects of their day to day well being can be eradicated. The much awaited demand of the people was fulfilled by the government in the name of NATIONALISATION OF ALL THE PRIVATE SECTOR BANKS.
NATIONALISATION OF BANKING
Despite the provisions, control and regulations of the Reserve bank of India, banks in India except the SBI, all the remaining banks owned and operated by private persons. By the 1960s, the Indian banking industry had become an important tool to facilitate the development of the Indian economy.
At the same time, it had emerged as a large employer, and a debate was going around strongly in favour of nationalization of the banking industry. Smt Indira gandhi, the then Prime Minister of India, expressed the intention of the Government of India in the annual conference of the All India Congress Meeting in a paper titled "Stray thoughts on Bank Nationalization. The meeting received the presentation with enthusiasm.
Thereafter, her move was swift and sudden. The Government of India issued an ordinance ('Banking Companies (Acquisition and Transfer of Undertakings) Ordinance, 1969') and nationalized 14 largest commercial banks with effect from the midnight of 19 July 1969.
These banks contained 85 percent of bank deposits in the country. Sri Jayaprakash Narayan, a national leader of India, described the step as a "masterstroke of political sagacity." Within two weeks of the issue of the ordinance, the Parliament passed the Banking Companies (Acquisition and Transfer of Undertaking) Bill, and it received the presidential approval on 9 August 1969.
A second dose of nationalisation of 6 more commercial banks followed in 1980. The stated reason for the nationalisation was to give the government more control of credit delivery. With the second dose of nationalisation, the Government of India controlled around 91% of the banking business of India.
To solve this issues and better development of the country, the government of India initiated the nationalization of our Central Bank of India [Reserve Bank of India] in 1949 followed with 14 major banks in 1969.The basic idea behind nationalisation was to serve the poor and not to earn profit, and also to boost up our Indian economy.
The objectives of initiating such an act was to rapidly expand the bank branches and channeling the credit in accordance with the set targets. These banks were given quantitative targets for the distribution of credit to specific sectors in the economy and for the expansion of their network through branches.
Following this initiative, the government nationalized seven more scheduled commercial banks in 1980, This move gave the impression that in case a private bank grew beyond the size, it would be brought under ambit of nationalization.
The second nationalization took place in order to affirm more control over the Indian banking system. The Indian banking system was becoming increasingly important to expand their presence unexposed, even the poverty ridden parts of the country. It was also enabled to increase priority sector lending and sourced the funds to bridge the budgetary deficits. Along with the nationalization of the Indian banks, the government also set the lending targets for priority sector.
FAILURE OF PRIVATE SECTOR BANKS AFTER NATIONALISATION
After Nationalisation, government paved the way for providing services of the Banking industry towards the multi facial sector [PRIORITY AND NON PRIORITY] of the people of India. Their intention was that, Indian banking sector should reach all the sectors of the people without making much profit from the banking business. During this period the government objective was for the development of our Indian economy and the impartial services to all the sector of the peoples. Moreover, government realized that their objective will be fulfilled only with the help of the PUBLIC SECTOR BANKS ONLY.
The aspiration of the government and the people were completely fulfilled by our PUBLIC SECTOR BANKS ONLY.
This government call was against the interest of the Private sector banks. Because, their business was PROFIT ORIENTED. During the period between 1947 and 1969, our country faced a massive failure of the PRIVATE SECTOR BANKS once again.
Even after nationalisation, private sector banks continued to fail. One of the most prominent example was the high-profile Global Trust Bank. GTB was eventually merged with Oriental Bank of Commerce in 2003. Between 1969 and 2014, TWENTY THREE private sector banks were merged with public sector banks for their inefficiency.
In 1960, the State Bank of India was given control of eight state-associated banks under the State Bank of India (Subsidiary Banks) Act, 1959. These were till recently called as associate Banks.
In 1969 the Indian Government nationalized 14 major private banks; one of the Big Bank was Bank of India. In 1980, 6 more private banks were nationalised. These nationalised banks were the majority of lenders in the Indian economy. They dominate the banking sector because of their large size and widespread networks.
The Indian banking sector is broadly classified into Scheduled banks and non-scheduled banks. The scheduled banks are those included under the second Schedule of the Reserve Bank of India Act, 1934.
The scheduled banks are further classified into: nationalised banks; State Bank of India and its associates; Regional Rural Bank (RRBs); foreign banks; and other Indian private sector banks.
The term commercial banks refer to both scheduled and non-scheduled commercial banks regulated under the Banking regulation Act 1949. All these sector wise divisions of the PSB, leads to unconditional service, for the benefit both the PRIORITY AND NON PRIORITY sectors of the people of India.
PUBLIC POLICY AND BANKING POLICY
The policy makers also realized that the Public policy and the banking policies are inseparable. Because, PSB are meant for the Publics only. Moreover PSB and the people of our country are interwoven, with the common agenda with MUTUAL INTEREST.
PREAMBLE of our Constitution of India, BY THE PEOPLE AND FOR THE PEOPLE IS CLEARLY VISIBLE IN OUR PUBLIC SECTOR BANKING ONLY. Any Private sector banks in our country cannot enter this zone, which is reserved for the PSB by the people of our country.
As per the government directives, the Public policy can be defined as courses of action, regulatory measures, laws and funding priorities concerning a given topic promulgated by the governmental entity or its representatives.
Banks undertake the two most important functions in an economy of providing payments services for the retail and wholesale markets and channeling savings into investment for ensuring economic activity and growth. Banks are highly leveraged entities using public funds; they have the ability to generate resources, they provide all types of financial services, hence our PSB operations are very much within the purview of public policy.
Here, once again we proves that PSB and the people of India are interwoven, their traditional socio-economic relationships can not be compromised at any cost. Because people of India already witnessed the failure of the private sector banks in various aspects.
PRESENT GOVERNMENT POLICIES
Though, the relationships between the PSB and the people of India are understood, our government is very keen towards merger and privatization of this massive economic asset.
The UPA had set up a committee under P.J. Nayak to suggest reforms in public sector banks in January 2014. The main thrust of its recommendations was Privatisation of PSBs.The present government not only endorsed the Nayak Committee report completely, but announced measures to implement the recommendations.
To achieve their ulterior ambition, they are tarnishing the best image being enjoyed by PSBs. In fact, no one in this country gained anything after independence,
When we closely observing the recent development in our Public Sector bank, we can understand the seriousness and treacherous activities done by our regulator and the government in a systematic way to eradicate our PSB in the arena of our Indian banking sector.
The latest those developments are appended below;-
From 2008-Compelling Indian PSB to become a major lender for the Infrastructure sector in India. This is being plunged to cover up the FISCAL DEFICIT of the government at the cost of the PSB.
Now Real estate sector also being included in this lending process. During this period, PSB stood first in lending and now it paved the way for a major NPA status from this sector.
PSBs are being forced to lend more for this sector for long term loan. Now, Tele communication also joins in this race. At the same time they encouraged the Private sector bank to lend more for the retail loans.
During that time onward, Private sector Banks are dominating in the Retail loans.
Then also, we were able to control the NPA level, though the regulator and the government were started tarnishing the best social sector of our Indian economy that is PSB. NPA level was within 1 Lakh crore upto 2015. At the same time, our NPA level suddenly raises from 1 lakh crore to 6.06 Lakh crore in December 2016.
This alarming NPA level is being artificially set out by the regulator and the government. This is not the natural NPA level during 2016. That was an artificial and man made NPA level during that accounting period such as
1. PROVISIONING FOR STANDARD ASSETS
2. BRINGS MORE ASSETS UNDER NPA CATEGORY BY AMENDING POLICIES
Thus government and regulator DEFAME our PSB and try to DE-LINK us from our best relation with general public, where no one in this democratic country achieved that after our independence. WILL IT BE SUCCESSFUL?
NEVER. Because, people of India never let down our PSB in the hands of big corporate.
Outcome of Cashless Economy such as, Digital payments, Adhaar based payment, all government ,social sector schemes payments to the publics, Payment of salaries to all the un organized sector and private sector employees, Small bank payments, Online transactions through various Applications , DEMONETISATION programmes is being well organized by the government and regulator, to accumulate the complete money through a single window.
Now the government is ready to channalise this huge money through this single window for the benefit of BIG CORPORATES. Cashless economy brings the normal citizen without cash. This cashless economy and Demonetisation does not bring any benefit for our brethren. But it makes the big corporates, to enhance their business in the Banking sector by sucking the common man income in the name of commission and extra charges.
Government is allowing, giving more interest rate by the Private Banks (CORPORATE OWNERS), and reducing the SB interest rate of the PSB simultaneously forcing the publics to rush towards the Private sector banks for depositing their hard earned money.
Accumulating poor man’s saving for long term basis for their individual business development. Final outcome of those deposits is understood for the economists of this country.
Finally, where they are going? What is their TARGET? Are they are marching towards PRIVATISATION!
The answer is YES. Now, the government and regulator ideology is to
Dear friends,
Banking system in India is carefully studied under two categories as per the service rendered by the Banking sector to the common man of this country. They are Pre Independence Phase [1786-1947] and Post Independence phase [1947 till date].
The banking facility for the people of India during the Pre independence period and Post independence period shows two different poles of managerial and administrative approach.
The unique identity of the common man during the Pre independence period was the socio- economic exploitation. Though these two approaches show various positive and negative developments for the Indian economy, the expectation of the people is to get rid off from these socio-economic exploitations from those capitalistic sector, prevalent during the Pre independence era.
Because, the economic exploitation of the peoples during the Pre-independence period were the symptoms of socio-economic atrocities against the common man by those capitalistic dominance.
Due to this exploitative situation, people were keen to tap an alternate institutions through which their economic standard was getting uplifted.
The development of Banking system during Pre independence Period was derived from ancient Vedic period. During the Pre independence period the main objective of the banking system was meant for serving the highest business society only, with the support of the rulers.
The colonization made the banking system to serve for the purpose of developing the business of an individual capitalists. From that stage, banking system was emerged due to swadeshi movement in India for serving the people of India.
Thus shifting of banking industry from an unilateral service to multi focal services. We can understand the growth of our banking industry with the intensified contribution of our people. At the same time, people harvested the benefit of the growth of Banking industry vide various social schemes.
Though these schemes were initiated by the government, implementation, and the end use were assured by our PSB. Thus growth of the PSB and the people were achieved simultaneously.
From the following paragraphs we can understand that PSB and the people are inseparable.
DEVELOPMENT OF BANKING IN PRE INDEPENDENCE PHASE
Banking in India, in the modern sense, originated in the last decades of the 18th century. Among the first banks were the Bank of Hindustan, which was established in 1770 and liquidated in 1829–32; and the General Bank of India, established in 1786 but failed in 1791.
The period between 1906 and 1911 saw the establishment of banks inspired by the Swadeshi movement. The Swadeshi movement inspired local businessmen and political figures to establish banks of and for the Indian community.
A number of banks established then have survived to the present such as Catholic Syrian bank,The South Indian bank, Bank of India, Corporation Bank,Indian Bank, Bank of Baroda, Canara Bank, and central Bank of India.
The fervour of Swadeshi movement led to the establishment of many private banks in Dakshina kannada and Udupi district, which were unified earlier and known by the name South Canara (South Kanara) district.
Four nationalised banks started in this district and also a leading private sector bank. Hence undivided Dakshina Kannada district is known as "Cradle of Indian Banking".
During the First World war (1914–1918) through the end of the Second World war (1939–1945), and two years thereafter until the independence of India were challenging for Indian banking. The years of the First World War were turbulent, and it took its toll with banks simply collapsing despite the Indian economy gaining indirect boost due to war-related economic activities. At least 94 banks in India failed between 1913 and 1918.
Bank of Calcutta was started in June 1806. In 1809, it was renamed as the Bank of Bengal. This was one of the three banks funded by a presidency government, and the other two were the Bank of Bombay in 1840 and the Bank of Madras in 1843.
The three banks were merged in 1921 to form the Imperial Bank of India, which upon India's independence, became the State bank of India in 1955. These small mergers were planned for the better administrative purposes only.
For many years the presidency banks had acted as quasi-central banks, as did their successors, until the Reserve Bank of India was established in 1935, under the Reserve bank of India Act 1934.
STATUS OF BANKING SECTOR IN PRE INDEPENDENCE PHASE
The Indian banking system at the time of independence was under Private ownership. The rural population of the country had to depend upon money lender for their requirement. A huge number of people lost their life’s earnings. The common man had no access to banking facilities, and the PARTICIPATION OF RURAL POPULATION WAS NIL.
Growth of Private sector banks during this period was massive and paved ways for a unilateral capitalism. It was found that the private sector banks in the country did not provide the required credit disbursal support, especially to the unorganized sector.
We have our major portion of our human resources in this unorganized sector from our Rural back ground that is back bone of our country. The unorganized sector consisting of farmers, small scale industries, transporters, self-employed and professionals had to largely depend on private moneylenders who exploited them with extremely high interest rates.
During this period, class banking was prominent rather than supporting the rural mass. A massive shifting was required at that time from CLASS BANKING TO MASS BANKING to bring Banking facilities at the door steps of the rural peoples to protect them from economic exploitation from local money lenders and to safeguard the hard earned money of those rural peoples.
This has led the government to turn their attention towards ‘TO PROTECT THE PUBLIC MONEY AND TO SERVE THE GROSS ROOT RURAL MASS AGAINT ECONOMIC EXPLOITATION”. Because, the government realized that banking industry only can serve for the upliftment of our Indian economy and serve the people of India.
Thus, pre independence period also witnessed that, Banking industry is paramount for the Indian economy. But the private sector banks were working on the basis of profit making only without the conscious of serving the people. Government realized that Public sector Banking only can serve both for the upliftment of our Indian economy and the people of India.
People of India were also keen to accept a strong public sector forum, by which these ill effects of their day to day well being can be eradicated. The much awaited demand of the people was fulfilled by the government in the name of NATIONALISATION OF ALL THE PRIVATE SECTOR BANKS.
NATIONALISATION OF BANKING
Despite the provisions, control and regulations of the Reserve bank of India, banks in India except the SBI, all the remaining banks owned and operated by private persons. By the 1960s, the Indian banking industry had become an important tool to facilitate the development of the Indian economy.
At the same time, it had emerged as a large employer, and a debate was going around strongly in favour of nationalization of the banking industry. Smt Indira gandhi, the then Prime Minister of India, expressed the intention of the Government of India in the annual conference of the All India Congress Meeting in a paper titled "Stray thoughts on Bank Nationalization. The meeting received the presentation with enthusiasm.
Thereafter, her move was swift and sudden. The Government of India issued an ordinance ('Banking Companies (Acquisition and Transfer of Undertakings) Ordinance, 1969') and nationalized 14 largest commercial banks with effect from the midnight of 19 July 1969.
These banks contained 85 percent of bank deposits in the country. Sri Jayaprakash Narayan, a national leader of India, described the step as a "masterstroke of political sagacity." Within two weeks of the issue of the ordinance, the Parliament passed the Banking Companies (Acquisition and Transfer of Undertaking) Bill, and it received the presidential approval on 9 August 1969.
A second dose of nationalisation of 6 more commercial banks followed in 1980. The stated reason for the nationalisation was to give the government more control of credit delivery. With the second dose of nationalisation, the Government of India controlled around 91% of the banking business of India.
To solve this issues and better development of the country, the government of India initiated the nationalization of our Central Bank of India [Reserve Bank of India] in 1949 followed with 14 major banks in 1969.The basic idea behind nationalisation was to serve the poor and not to earn profit, and also to boost up our Indian economy.
The objectives of initiating such an act was to rapidly expand the bank branches and channeling the credit in accordance with the set targets. These banks were given quantitative targets for the distribution of credit to specific sectors in the economy and for the expansion of their network through branches.
Following this initiative, the government nationalized seven more scheduled commercial banks in 1980, This move gave the impression that in case a private bank grew beyond the size, it would be brought under ambit of nationalization.
The second nationalization took place in order to affirm more control over the Indian banking system. The Indian banking system was becoming increasingly important to expand their presence unexposed, even the poverty ridden parts of the country. It was also enabled to increase priority sector lending and sourced the funds to bridge the budgetary deficits. Along with the nationalization of the Indian banks, the government also set the lending targets for priority sector.
FAILURE OF PRIVATE SECTOR BANKS AFTER NATIONALISATION
After Nationalisation, government paved the way for providing services of the Banking industry towards the multi facial sector [PRIORITY AND NON PRIORITY] of the people of India. Their intention was that, Indian banking sector should reach all the sectors of the people without making much profit from the banking business. During this period the government objective was for the development of our Indian economy and the impartial services to all the sector of the peoples. Moreover, government realized that their objective will be fulfilled only with the help of the PUBLIC SECTOR BANKS ONLY.
The aspiration of the government and the people were completely fulfilled by our PUBLIC SECTOR BANKS ONLY.
This government call was against the interest of the Private sector banks. Because, their business was PROFIT ORIENTED. During the period between 1947 and 1969, our country faced a massive failure of the PRIVATE SECTOR BANKS once again.
Even after nationalisation, private sector banks continued to fail. One of the most prominent example was the high-profile Global Trust Bank. GTB was eventually merged with Oriental Bank of Commerce in 2003. Between 1969 and 2014, TWENTY THREE private sector banks were merged with public sector banks for their inefficiency.
In 1960, the State Bank of India was given control of eight state-associated banks under the State Bank of India (Subsidiary Banks) Act, 1959. These were till recently called as associate Banks.
In 1969 the Indian Government nationalized 14 major private banks; one of the Big Bank was Bank of India. In 1980, 6 more private banks were nationalised. These nationalised banks were the majority of lenders in the Indian economy. They dominate the banking sector because of their large size and widespread networks.
The Indian banking sector is broadly classified into Scheduled banks and non-scheduled banks. The scheduled banks are those included under the second Schedule of the Reserve Bank of India Act, 1934.
The scheduled banks are further classified into: nationalised banks; State Bank of India and its associates; Regional Rural Bank (RRBs); foreign banks; and other Indian private sector banks.
The term commercial banks refer to both scheduled and non-scheduled commercial banks regulated under the Banking regulation Act 1949. All these sector wise divisions of the PSB, leads to unconditional service, for the benefit both the PRIORITY AND NON PRIORITY sectors of the people of India.
PUBLIC POLICY AND BANKING POLICY
The policy makers also realized that the Public policy and the banking policies are inseparable. Because, PSB are meant for the Publics only. Moreover PSB and the people of our country are interwoven, with the common agenda with MUTUAL INTEREST.
PREAMBLE of our Constitution of India, BY THE PEOPLE AND FOR THE PEOPLE IS CLEARLY VISIBLE IN OUR PUBLIC SECTOR BANKING ONLY. Any Private sector banks in our country cannot enter this zone, which is reserved for the PSB by the people of our country.
As per the government directives, the Public policy can be defined as courses of action, regulatory measures, laws and funding priorities concerning a given topic promulgated by the governmental entity or its representatives.
Banks undertake the two most important functions in an economy of providing payments services for the retail and wholesale markets and channeling savings into investment for ensuring economic activity and growth. Banks are highly leveraged entities using public funds; they have the ability to generate resources, they provide all types of financial services, hence our PSB operations are very much within the purview of public policy.
Here, once again we proves that PSB and the people of India are interwoven, their traditional socio-economic relationships can not be compromised at any cost. Because people of India already witnessed the failure of the private sector banks in various aspects.
PRESENT GOVERNMENT POLICIES
Though, the relationships between the PSB and the people of India are understood, our government is very keen towards merger and privatization of this massive economic asset.
The UPA had set up a committee under P.J. Nayak to suggest reforms in public sector banks in January 2014. The main thrust of its recommendations was Privatisation of PSBs.The present government not only endorsed the Nayak Committee report completely, but announced measures to implement the recommendations.
To achieve their ulterior ambition, they are tarnishing the best image being enjoyed by PSBs. In fact, no one in this country gained anything after independence,
When we closely observing the recent development in our Public Sector bank, we can understand the seriousness and treacherous activities done by our regulator and the government in a systematic way to eradicate our PSB in the arena of our Indian banking sector.
The latest those developments are appended below;-
From 2008-Compelling Indian PSB to become a major lender for the Infrastructure sector in India. This is being plunged to cover up the FISCAL DEFICIT of the government at the cost of the PSB.
Now Real estate sector also being included in this lending process. During this period, PSB stood first in lending and now it paved the way for a major NPA status from this sector.
PSBs are being forced to lend more for this sector for long term loan. Now, Tele communication also joins in this race. At the same time they encouraged the Private sector bank to lend more for the retail loans.
During that time onward, Private sector Banks are dominating in the Retail loans.
Then also, we were able to control the NPA level, though the regulator and the government were started tarnishing the best social sector of our Indian economy that is PSB. NPA level was within 1 Lakh crore upto 2015. At the same time, our NPA level suddenly raises from 1 lakh crore to 6.06 Lakh crore in December 2016.
This alarming NPA level is being artificially set out by the regulator and the government. This is not the natural NPA level during 2016. That was an artificial and man made NPA level during that accounting period such as
1. PROVISIONING FOR STANDARD ASSETS
2. BRINGS MORE ASSETS UNDER NPA CATEGORY BY AMENDING POLICIES
Thus government and regulator DEFAME our PSB and try to DE-LINK us from our best relation with general public, where no one in this democratic country achieved that after our independence. WILL IT BE SUCCESSFUL?
NEVER. Because, people of India never let down our PSB in the hands of big corporate.
Outcome of Cashless Economy such as, Digital payments, Adhaar based payment, all government ,social sector schemes payments to the publics, Payment of salaries to all the un organized sector and private sector employees, Small bank payments, Online transactions through various Applications , DEMONETISATION programmes is being well organized by the government and regulator, to accumulate the complete money through a single window.
Now the government is ready to channalise this huge money through this single window for the benefit of BIG CORPORATES. Cashless economy brings the normal citizen without cash. This cashless economy and Demonetisation does not bring any benefit for our brethren. But it makes the big corporates, to enhance their business in the Banking sector by sucking the common man income in the name of commission and extra charges.
Government is allowing, giving more interest rate by the Private Banks (CORPORATE OWNERS), and reducing the SB interest rate of the PSB simultaneously forcing the publics to rush towards the Private sector banks for depositing their hard earned money.
Accumulating poor man’s saving for long term basis for their individual business development. Final outcome of those deposits is understood for the economists of this country.
Finally, where they are going? What is their TARGET? Are they are marching towards PRIVATISATION!
The answer is YES. Now, the government and regulator ideology is to
1. PRIVATISATION OF PROFITS &
2. SOCIALISATION OF LOSSES
Now, government is mobilizing social media against our PSBs starting from our DEMONETISATION PROGRAMMES. They planned and turn the common man against the PSB to DE LINK PSB FROM PUBLIC.
Thus defaming the PSB in front of our common man. Now, they are making our common man to raise the question’WHY WE SHOULD pay for the alleged inefficiency of PSB.
We have to see the performance of PSBs, which have not only survived the major global economic crisis but also shared the government’s social agenda like the farm loan waiver, the Jan Dhan Yojana, priority sector lending and lending to small and medium enterprises. These are the activities which bring our profitability under pressure.
1. The contribution of Private sector banks in these social welfare schemes is almost NIL.
2. Private sector banks are not ready to share the government’s social responsibilities.
3. Private sector Bank even in the matters of recruitment, they don’t follow the government’s reservation policy.
4. Don’t show any enthusiasm in giving education loans to needy students.
Thus, we can see that privatisation is not the solution for problems facing PSBs. Moreover, Merger is also not the solution for the present situation.
MERGER INITIATIVE
As per the latest development in banking industry we have been informed by our (Regulator) Reserve Bank of India (RBI) HDFC Bank is the second largest private sector lender of country in list of Domestic Systemically Important Bank, (D-SIB).
HDFC is the third largest bank in our country after SBI and ICICI.
2. SOCIALISATION OF LOSSES
Now, government is mobilizing social media against our PSBs starting from our DEMONETISATION PROGRAMMES. They planned and turn the common man against the PSB to DE LINK PSB FROM PUBLIC.
Thus defaming the PSB in front of our common man. Now, they are making our common man to raise the question’WHY WE SHOULD pay for the alleged inefficiency of PSB.
We have to see the performance of PSBs, which have not only survived the major global economic crisis but also shared the government’s social agenda like the farm loan waiver, the Jan Dhan Yojana, priority sector lending and lending to small and medium enterprises. These are the activities which bring our profitability under pressure.
1. The contribution of Private sector banks in these social welfare schemes is almost NIL.
2. Private sector banks are not ready to share the government’s social responsibilities.
3. Private sector Bank even in the matters of recruitment, they don’t follow the government’s reservation policy.
4. Don’t show any enthusiasm in giving education loans to needy students.
Thus, we can see that privatisation is not the solution for problems facing PSBs. Moreover, Merger is also not the solution for the present situation.
MERGER INITIATIVE
As per the latest development in banking industry we have been informed by our (Regulator) Reserve Bank of India (RBI) HDFC Bank is the second largest private sector lender of country in list of Domestic Systemically Important Bank, (D-SIB).
HDFC is the third largest bank in our country after SBI and ICICI.
As per the RBI directives, our country’s economy is dependent upon these biggest banks.
Because, these banks are perceived as ‘Too Big To Fail” (TBTF) theory. This theory was initiated by the global bankers after the financial crisis 2008.
As per Business dictionary, the “Too Big To Fail theory asserts that certain corporations, particularly financial institutions, are so large and so interconnected that their failure would be disastrous to the greater economic system in the country.
To evade that, those financial institutions must be supported by government when they face potential failure. The government might be tempted to step in if ‘THESE INSTITUTIONS FACES PROBLEMS / FAILURES WITHIN THE COMPANY OR OUTSIDE THE PROBLEMS”.
Bringing an illusion to the citizen of India that, Big financial institution only can serve better for the countrymen, than an individual PSB. Thus cultivate the symptoms of MERGER POLICY indirectly in the minds of the people.
When Global Financial institutions were facing the Crisis during 2008, only financial institution in this globe, to stand firm and proves the stability and confidence to their customers are our Indian Public Sector banks (PSB).
The remaining part of the globe formulated this TBTF theory to safeguard their economic slide, why the same formula is being followed for our Indian financial sector?
Regulator and Controller admit that, failures / collapse are prominent in these Too Big financial institutions also. At the same time, they are predetermined to save those big institutions with amended policies and frame work from time to time. Initially, they were safeguarding the individual PSB.
Afterwards, for the past three years, their policies are against PSB. Now they are supporting the too Big financial institutions only. Why the same strategy is not followed to set right for our individual PSB?
Now the Regulator and Controller are moving towards to set right of the Private sector banks. Bringing hope and confidence among the minds of the people, that Private sector banks are more secure than our PSB. They brainwash the minds of the common man that, PSB are under collapsed state, and the solution is the MERGER POLICY to follow the TBTF theory.
When Regulator and Controller are considering only the Gross NPA as a primary tool to decide the fate of the PSB, it is paramount for them to shows how maximum PSB falls under this poor GNPA status within last three years.
Also, the bifurcation of this Gross NPA is to be disclosed to the common man. The major NPA are coming under POWER, STEEL, ROAD INFRASTRUCTURE AND TEXTILES. My dear friends please spell out, who are the major owners of these sectors. No doubt, they are the major CORPORATES of our poor country.
As per the latest report of our RBI, Just TWELVE ACCOUNTS of corporate loan defaulters that accounts for TWENTY FIVE PERCENT of the total NPA in our Indian banking sector.
Our Regulator instructed banks to file insolvency proceedings against these companies, under the new Insolvency and Bankruptcy Code as per the revised BR Act 2017. The regulator did not explicitly name those12 accounts to the common man till now. Now, RBI is bringing those culprits under their shadow [Overseeing Committee (OC)]. SBI and RRB are brought under this scrutiny.
The treacherous activities of the government and regulator to be put forth in front of the common man that is PUBLIC. Because they are only going to be affected much. We as an employee of the PSB are included in that PUBLIC. Now, as a banker, we also have social responsibility to makes the common man to understand the treacherous developments in our PSB.
Every individual of us should make the common man to identify the danger for their social harmony and security, and explains the public regarding the dangerous situation prevailing in our PSB which would go against the common man.
Dear Brethren, the idea of the existing government is MERGER AND PRIVATISATION. Once this happens, the other recommendations, such as reducing priority sector lending or making it profitable, cutting down on unprofitable banking activities such as lending to small and medium entrepreneurs, will automatically follow.
This would totally defeat the idea of inclusive banking as it is practiced now and was the guiding principle at the time of nationalisation of banks. Besides, if we look at the government’s record, in 2000 too, the then NDA government tried to reduce the government’s share in PSBs but dropped the idea because of the stiff opposition from the Trade Unions and the Left parties. The present political situation is a volatile and a dangerous one towards PSB.
We need to tell the people,
Why it is necessary to save the public sector Bank?
Why concentration of wealth in the hands of a few powerful individuals is not good for the common people?
Why we should learn from the experiences of Japan, Korea and the USA?
Why we need to heed the earlier warnings by the RBI, which said in 2010 that private sector ignored SMEs [small and medium enterprises], agriculture, education and export?
CONCLUSION
These problems are not pertaining to Public sector banks alone; it is a WAR AGAINST THE WELFARE OF THE PEOPLE OF INDIA. The Public sector Bank is sailing along with the people of India, for their well being from beginning to till date. PSB, are the BOON for their socio-economic upliftment. This treacherous move of the government symbolizes, returning of the Pre-Independence period situation.
It is the moral duty of the each and every individuals of the PSB, to make the people to understand the present danger of the PSB..
We the PSB employees, are the best ambassadors to bring awareness among the people of our country. Because, we are having our banking branches throughout the country. Even, the remote areas are also having our bank branches. We must educate the customers and the public of our country regarding the MERGER AND PRIVATISATION threats by this treacherous government.
Apart from this we must join hands with other PSU organisations in our country, and architect a National Platform to bring all the Public Sector Officers’ Organisation under a single umbrella.
This unity can play a vital role, to arrest these types of ANTI PEOPLE ACTIVITIES. The representation from all the Public Sector enterprises, like Power engineers, Telecom, Insurance, and Railways should come together for this social cause to help the people of India.
We should plan a nationwide campaign to create public awareness. We will do it through street plays, short films and documentaries. We must plan to organise alternative Gyan Sangams to educate people on the tremendous contribution of PSB for the upliftment of the subjugated people of India towards nation building.
Because, these banks are perceived as ‘Too Big To Fail” (TBTF) theory. This theory was initiated by the global bankers after the financial crisis 2008.
As per Business dictionary, the “Too Big To Fail theory asserts that certain corporations, particularly financial institutions, are so large and so interconnected that their failure would be disastrous to the greater economic system in the country.
To evade that, those financial institutions must be supported by government when they face potential failure. The government might be tempted to step in if ‘THESE INSTITUTIONS FACES PROBLEMS / FAILURES WITHIN THE COMPANY OR OUTSIDE THE PROBLEMS”.
Bringing an illusion to the citizen of India that, Big financial institution only can serve better for the countrymen, than an individual PSB. Thus cultivate the symptoms of MERGER POLICY indirectly in the minds of the people.
When Global Financial institutions were facing the Crisis during 2008, only financial institution in this globe, to stand firm and proves the stability and confidence to their customers are our Indian Public Sector banks (PSB).
The remaining part of the globe formulated this TBTF theory to safeguard their economic slide, why the same formula is being followed for our Indian financial sector?
Regulator and Controller admit that, failures / collapse are prominent in these Too Big financial institutions also. At the same time, they are predetermined to save those big institutions with amended policies and frame work from time to time. Initially, they were safeguarding the individual PSB.
Afterwards, for the past three years, their policies are against PSB. Now they are supporting the too Big financial institutions only. Why the same strategy is not followed to set right for our individual PSB?
Now the Regulator and Controller are moving towards to set right of the Private sector banks. Bringing hope and confidence among the minds of the people, that Private sector banks are more secure than our PSB. They brainwash the minds of the common man that, PSB are under collapsed state, and the solution is the MERGER POLICY to follow the TBTF theory.
When Regulator and Controller are considering only the Gross NPA as a primary tool to decide the fate of the PSB, it is paramount for them to shows how maximum PSB falls under this poor GNPA status within last three years.
Also, the bifurcation of this Gross NPA is to be disclosed to the common man. The major NPA are coming under POWER, STEEL, ROAD INFRASTRUCTURE AND TEXTILES. My dear friends please spell out, who are the major owners of these sectors. No doubt, they are the major CORPORATES of our poor country.
As per the latest report of our RBI, Just TWELVE ACCOUNTS of corporate loan defaulters that accounts for TWENTY FIVE PERCENT of the total NPA in our Indian banking sector.
Our Regulator instructed banks to file insolvency proceedings against these companies, under the new Insolvency and Bankruptcy Code as per the revised BR Act 2017. The regulator did not explicitly name those12 accounts to the common man till now. Now, RBI is bringing those culprits under their shadow [Overseeing Committee (OC)]. SBI and RRB are brought under this scrutiny.
The treacherous activities of the government and regulator to be put forth in front of the common man that is PUBLIC. Because they are only going to be affected much. We as an employee of the PSB are included in that PUBLIC. Now, as a banker, we also have social responsibility to makes the common man to understand the treacherous developments in our PSB.
Every individual of us should make the common man to identify the danger for their social harmony and security, and explains the public regarding the dangerous situation prevailing in our PSB which would go against the common man.
Dear Brethren, the idea of the existing government is MERGER AND PRIVATISATION. Once this happens, the other recommendations, such as reducing priority sector lending or making it profitable, cutting down on unprofitable banking activities such as lending to small and medium entrepreneurs, will automatically follow.
This would totally defeat the idea of inclusive banking as it is practiced now and was the guiding principle at the time of nationalisation of banks. Besides, if we look at the government’s record, in 2000 too, the then NDA government tried to reduce the government’s share in PSBs but dropped the idea because of the stiff opposition from the Trade Unions and the Left parties. The present political situation is a volatile and a dangerous one towards PSB.
We need to tell the people,
Why it is necessary to save the public sector Bank?
Why concentration of wealth in the hands of a few powerful individuals is not good for the common people?
Why we should learn from the experiences of Japan, Korea and the USA?
Why we need to heed the earlier warnings by the RBI, which said in 2010 that private sector ignored SMEs [small and medium enterprises], agriculture, education and export?
CONCLUSION
These problems are not pertaining to Public sector banks alone; it is a WAR AGAINST THE WELFARE OF THE PEOPLE OF INDIA. The Public sector Bank is sailing along with the people of India, for their well being from beginning to till date. PSB, are the BOON for their socio-economic upliftment. This treacherous move of the government symbolizes, returning of the Pre-Independence period situation.
It is the moral duty of the each and every individuals of the PSB, to make the people to understand the present danger of the PSB..
We the PSB employees, are the best ambassadors to bring awareness among the people of our country. Because, we are having our banking branches throughout the country. Even, the remote areas are also having our bank branches. We must educate the customers and the public of our country regarding the MERGER AND PRIVATISATION threats by this treacherous government.
Apart from this we must join hands with other PSU organisations in our country, and architect a National Platform to bring all the Public Sector Officers’ Organisation under a single umbrella.
This unity can play a vital role, to arrest these types of ANTI PEOPLE ACTIVITIES. The representation from all the Public Sector enterprises, like Power engineers, Telecom, Insurance, and Railways should come together for this social cause to help the people of India.
We should plan a nationwide campaign to create public awareness. We will do it through street plays, short films and documentaries. We must plan to organise alternative Gyan Sangams to educate people on the tremendous contribution of PSB for the upliftment of the subjugated people of India towards nation building.
CBOA ZINDABAD
AINBOF ZINDABAD
AIBOC ZINDABAD
MURUGAN R
OFFICER, CANARA BANK
THENI ALLINAGARAM
AINBOF ZINDABAD
AIBOC ZINDABAD
MURUGAN R
OFFICER, CANARA BANK
THENI ALLINAGARAM
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