Bank unions call two days strike as ‘total success’

Bank unions have warned to intensify their agitation if Indian Bank's Association-IBA and the government does not come forward to resolve their pending issues

United Forum of Bank Unions (UFBU), the umbrella organisation of five employee unions and four officer unions of state-run banks in the country, has called its two days strike as 'total success'.

About 10 lakh bank employees from nine unions, All India Bank Employees' Association (AIBEA), All India Bank Officers Confederation (AIBOC), National Confederation Of Bank Employees (NCBE), All India Bank Officers Association (AIBOA), Bank Employees Federation Of India (BEFI), Indian National Bank Employees Federation (INBEF), Indian National Bank Officers Congress (INBOC), National Organisation Of Bank Workers (NOBW) and National Organisation Of Bank Officers (NOBO) participated in the 48-hour strike between 10-11 February.

"The strike was called to demand immediate wage revision for bank employees and officers and to protest against retrograde banking sector reforms like privatisation of public sector banks, granting licence to corporate houses to start their own banks, encouraging foreign banks to take over our banks and siphoning out huge amounts through write off of bad loans of corporate defaulters," said CH Venkatachalam, general secretary, AIBEA in a statement.

Commenting on finance minister P Chidambaram's statement that entire profits of banks cannot be utilised for enhancing wages of employees, Mr Venkatachalam said, "That is not our demand also. We are only asking for a reasonable increase in wages that too when banks are making good profits."

Reiterating that bank employee unions are ready to resolve the issues by discussions, he said, "UFBU is always open to resolve the demands by discussions and negotiations but Indian Bank's Association (IBA) and the government should also be forthcoming. If the same negative attitude will continue, we will be left with no alternative than to further intensify the agitation. UFBU will be meeting shortly for this purpose."


Sensex, Nifty to come under pressure again? : Tuesday closing report

Six days are over since the Nifty made a low at 5,933 during eight days of decline, but the index has not even retraced 50% of the fall. This indicates that the bulls are not confident

As we had mentioned in Monday’s closing report, the Indian benchmark indices tried to keep itself in the green. Today after a volatile session, the BSE 30-share Sensex managed to cover more than half of yesterday’s loss, while the NSE 50-share Nifty managed to make up for yesterday’s entire negative move. Today, the Nifty moved almost in the same range as yesterday while continuing to make an attempt to reach up to the level of 6,100.


The Sensex opened at 20,401 and moved in the range of 20,350 and 20,443 before closing at 20,363 (up 29 points or 0.14%). The Nifty, which opened at 6,072, hit a low of 6,053 and moved higher to hit a high of 6,082 before closing at 6,063 (up 9 points or 0.15%). The NSE recorded a volume of 47.37 crore shares.


Among the other indices on the NSE, the top five gainers were Auto (0.99%); IT (0.95%); Finance (0.53%); Service (0.44%) and Metal (0.37%) while the top five losers were Media (1.33%); Energy (0.91%); Realty (0.80%); Infra (0.51%) and Pharma (0.47%).


Of the 50 stocks on the Nifty, 25 ended in the green. The top five gainers were HCL Technologies (4.35%); Ranbaxy (2.99%); Tata Motors (2.76%); Tata Steel (2.43%) and BPCL (1.63%). The top five losers were NTPC (2.92%); Reliance (2.21%); PNB (2.16%); Hindalco (2.11%) and Hero MotoCorp (1.91%).


Of the 1,492 companies on the NSE, 645 closed in the positive, 753 closed in the negative while 94 closed flat.


The fall in Nifty from 6,346 on 23rd January lasted for eight days and 413 points. Now, six trading days are over since the Nifty touched a low at 5,933, but the index has not even retraced 50% of the fall. This indicates that the bulls are not confident. Now, only a strong US market can bring back the bulls.


Reliance Industries was among one of the top five losers today in the pack of Sensex 30 stocks. Delhi chief minister Arvind Kejriwal said he has asked for legal cases to be filed against Reliance Industries Chairman Mukesh Ambani and policymakers over pricing of gas produced from the D6 block in the east coast. Kejriwal alleged that the company has created an artificial shortage of fuel in the country. Kejriwal said he would ask the central government to suspend the latest order on gas pricing pending an inquiry.


India's trade deficit narrowed to $9.92 billion in January 2014, from $10.14 billion in December 2013, data released by the government on Tuesday showed. On year-on-year basis, merchandise exports rose 3.79% to $26.75 billion in January 2014. Imports fell 18.07% year-on-year to $36.67 billion led by a 77% drop in gold and silver imports on the year.


The emergence of an Indian coalition government of smaller parties after elections this year may weaken the rupee and heighten risks to the nation’s credit ratings, Moody’s Investors Service said today. Moody’s rates India’s long-term foreign currency and local-currency debt at Baa3, the lowest investment grade, with a stable outlook. US indices closed marginally higher on Monday.


Federal Reserve Chairman Janet Yellen delivers her first testimony on monetary policy later in the global day today, 11 February 2014. Yellen will speak on monetary policy and the outlook for the US economy for the first time since being sworn in as the central bank's head.


All the Asian indices trading today closed in the positive. Hang Seng was the top gainer which rose 1.78%


How Chidambaram can walk the talk on bank issues

If Chidambaram’s expectation comes from genuine concern for public sector units, then it should be demonstrated by not giving ‘informal’ directions to transfer surplus income or profit to government or declare dividends to meet budgeted ‘quota’ of receipts

Finance Minister P Chidambaram’s loud thinking at the 78th Foundation Day celebrations of Indian Overseas bank on the role expectations from the public sector banks is indicative of a welcome change in government of India (GOI)’s approach to management of public sector undertakings (PSUs) in general.


The following observations by the FM are comforting, as they signal a change in GOI’s approach to the management of public sector organizations including Life Insurance Corp of India (LIC) and banks and statutory bodies like Reserve Bank of India (RBI):

  1. The claims of staff and employees should be duly acknowledged, recognised and fair and just settlements arrived at.
  2. There is humungous need for capital. Banks have to find their own capital from retained earnings. Banks had pumped in Rs35,000 crore and Rs37,000 crore capital from retained earnings in 2011-12 and 2012-13, respectively.
  3. We cannot show laxity to wilful defaulters. The amount of non-performing assets (NPAs) in September 2013 has more than doubled since March 2011. It cannot be where loans will become non-performing, borrowers prosper and lenders suffer. Banks must identify wilful defaulters, take stern steps to recover loans from wilful defaulters.

FM should walk the talk by taking the following initiatives:

  1. Take back the responsibility of wage negotiations from Indian Bank’s Association (IBA),  which is going by the traditional method of first offering some paltry rise, then stepping up commensurate with the pressure mounting up and coming to a settlement at a ‘convenient’ time, without clinching anything on ‘employee responsibility’. Chidambaram should give clear indications about the expectations from management and employees of banks and express readiness to offer market-related wage structure.
  2. It is common knowledge that GOI has been milking profit-making public sector undertakings, including public sector banks and statutory bodies, dry by making unreasonable demands for cash transfer to government or diversion of resources to less profitable avenues. If FM’s expectation comes from genuine concern for the health of PSUs, this should be demonstrated by not giving ‘informal’ directions to transfer surplus income/ profit to GOI or declare dividends to meet budgeted ‘quota’ of receipts from government-owned organizations.
  3. GOI should provide legislative and other support to banks for recovering dues from wilful defaulters.

To read more articles by MG Warrier, please click here.

(MG Warrier is former general manager of Reserve Bank of India.)



Ramesh Jaradhara

3 years ago

NPAs become a big burden for PSU banks due to laxity of govt action and legislative proceedings.If govt is keen to recover bad loans from willful defaulters, the position of banks will definitely improve.

S K Nataraj

3 years ago

I fully agree with Mr. Warrier's views. The FM has only the responsibility to lay down broad policy guidelines and it is not for him to dictate to public sector banks to pay more to the country's exchequer by way of dividends. He can broadly state as a Finmin that they should follow prudent lending practices, and curb the NPAs and also exhort the PSbs to take sterner measures for NPA recovery, and boost lending to certain productive sectors. But it is solely left to the banks to follow what practices they feel are right and prudent with regard to interest, sectors that need to be financed, the quantum etc. banks have a huge responsibility to their stakeholders too, the finmin is clearly exceeding his brief in spelling that PSBs ought to rake in the moolah and dole out higher dividends to the government. Already his acquiescence in the matter of opening of more than 200 branches in his constituency Sivaganga has meant that most of these branches are not turning in any profits and are loss- making. Let him correct things in his constituency first, and make every bank branch in Sivaganga profitable. After that, he will do well to address the profitability concerns of the PS Banks.


3 years ago

While granting & recovery of loans are the responsibility of the concerned officers/executives,paying minimum eligible bonus of 8% goes automatically,and it is upto the managementg to further increase or not,subject bank"s performance towards recovery of bad debts as well.Most of the dafaulters are not persons connected with MNC and have other investments in their or in their family names.Hence, the bank has to find out to keep in touch with the borrwers and ensure the banks gets its legitimat income on their borrwings as well,.

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