Parliamentary panel demands clarity on mergers in public sector banks

The Standing Committee on Finance headed by former finance minister Yaswant Sinha, in its report tabled in Parliament on Tuesday, demanded a clear policy on mergers and consolidation in the public sector banks. It also sought the reasons for rising non-performing assets (NPAs) in the SBI Group

New Delhi: Accusing government of adhocism, a Parliamentary committee on Tuesday demanded a clear policy on mergers and consolidation in the public sector banks, including amalgamation of associates with the State Bank of India (SBI), reports PTI.

"...There is a strong element of adhocism in the policy stance and approach of the government in brining in legislative changes in the Acts regulating the SBI and its subsidiaries in particular," the Standing Committee on Finance headed by former finance minister Yaswant Sinha said in its report tabled in Parliament yesterday.

It is also imperative to assess in clear terms, the reasons for rising non-performing assets (NPAs) in the SBI Group as well as the desirability of pursuing the policy of merging the subsidiary banks with SBI, particularly in the light of issues relating top manageability of large sized banks, it noted.

It is appropriate on part of the government to make an in-depth analysis of issues relating to mergers and consolidation of the public sector banks in general, it said.

"The committee expects the government to spell out the policy-related aspects in this regard," it said.

Meanwhile, it cleared the State Bank of India (subsidiary banks laws) Amendment Bill, 2009 for passage by Parliament.

The amendment proposals of the State Bank of India (Subsidiary Banks Laws) Amendment Bill, 2009 have been necessitated owning to transfer of ownership of the State Bank of India (SBI) from Reserve Bank to central government, it said.

It also suggested amendment in the SBI Pension Fund Rules, which is detrimental to the retirees of the merged subsidiary banks.

The panel expects the government to expeditiously act on these matters.

The bill, which, seeks to empower the government to fix the authorised or the issued capital of a subsidiary of the SBI or to appoint its top officials, was referred to the panel on 18December 2009 for examination.

Once passed, the bill would empower the Centre to increase or reduce the authorised capital of a subsidiary bank, fixation and raising of issued capital, issuing bonus shares to shareholders and appointment of managing director, among other things.

The legislation would amend the State Bank of Hyderabad Act and the SBI (Subsidiary Banks) Act to incorporate these provisions.

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Anil Ambani meets Maharashtra CM on Sea Link extension

State government reported to be considering a coastal road from Worli to Haji Ali and beyond to Nariman Point, instead of extending Sea Link that Ambani-led consortium was to build

Mumbai: Industrialist Anil Ambani on Tuesday met Maharashtra chief minister Prithviraj Chavan, apparently with regard to the extension of the Bandra-Worli Sea Link to Haji Ali, reports PTI.

It has been reported recently that the Maharashtra State Road Development Corporation (MSRDC) is mulling a coastal road from Worli to Haji Ali, and onwards to Nariman Point.

Last year a consortium of Anil Ambani's Reliance and Hyundai won a Rs5,000 crore contract to extend the Sea Link to Haji Ali. But the consortium was unable to tie up funds by the December 2010 deadline and it sought a three-month extension for this.

The coastal road option is now being considered to save cost. According to MSRDC sources, the coastal road option could save the government over Rs3,000 crore.

An official from the chief minister's office said that the one-on-one meeting between Mr Chavan and Mr Ambani took place at the state government's Sahyadri guest house last night and went on for about 30 minutes.

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There could be a big market crash coming your way this Christmas

Wall Street's conmen are selling lies, hype and hoopla. Listen to them at your own peril.

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