The Hindu : National : SBI Amendment Bill introduced

Online edition of India's National Newspaper
Friday, Aug 17, 2007
ePaper

National

National

SBI Amendment Bill introduced

Special Correspondent

NEW DELHI: The Government on Thursday introduced a Bill in the Lok Sabha seeking to replace the Ordinance enabling transfer of the Reserve Bank’s equity holding in the State Bank of India (SBI) to the Centre.

According to the statement of objects and reasons of the State Bank of India (Amendment) Bill, 2007, introduced by Finance Minister P. Chidambaram, the Government had, in February this year, approved the proposal for transfer of ownership of SBI shares held by the RBI to the Government.

Narasimhan panel

The move was consequent to acceptance of the recommendations of the Narasimhan Committee on Banking Reforms which observed that “it is inconsistent with the principles of effective supervision that the regulator is also an owner of the bank.”

The transfer of ownership involves the entire equity holding of the RBI in SBI which, in effect, works out to over 31 crore shares comprising 59.73 per cent of SBI’s total equity.

To implement the transfer of ownership transaction, the Government provided Rs. 40,000 crore in the Budget for the current fiscal.

In view of the large sum involved, it was decided to complete the transaction before June 30 this year.

However, for this, it became necessary to carry out urgently the required amendments in the SBI Act of 1955.

Printer friendly page
Send this article to Friends by E-Mail

National