The Hindu : Karnataka / Bangalore News : Bank unions plan strike on August 20

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Wednesday, Aug 13, 2008
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Karnataka

Karnataka - Bangalore

Bank unions plan strike on August 20

Special Correspondent

Campaign to ‘protect’ public sector banks

Unions release list of ‘wilful’ defaulters of loans
‘Centre is bent
on privatisation
of banks’

Bangalore: Two leading unions representing workers and officers in the banking sector, the All India Bank Employees’ Association (AIBEA) and the All India Bank Officers’ Association (AIBOA), have launched a nationwide campaign to “protect” public sectors banks.

The joint campaign, which commenced on July 19, the day banks were nationalised in 1969, will end on August 19, a day before the all-India strike by workers in the banking and insurance industry. The leaders of the two unions also released a list of “wilful” defaulters of bank loans in Karnataka.

Vasant Rai, general secretary of the Karnataka Pradesh Bank Employees’ Federation, which is affiliated to AIBEA, said that the problem of “wilful” defaulters of bank loans in the State had assumed serious proportions.

As on September 2007, there were 141 loan accounts, in wilful default, owing Rs. 485 crores to banks in the State.

Mr. Rai said wilful defaulters were “those who have the capacity to repay but refuse to.”

He demanded that “criminal prosecution be launched against such offenders.”

Among the biggest defaulters is a Bangalore-based group which owes more than Rs. 85 crore to various banks in the State.

The figures released by the unions show that Karnataka is placed seventh among the States having the highest defaulters. Mr. Rai said: “The events in the last few weeks showed that the Union Government is bent on the wholesale privatisation of the public sector banks.”

He said that the unions had opposed the recommendations of the Raghuram Rajan Committee on Banking Reforms. Among the recommendations of the commission was the suggestion that the government equity in public sector be reduced to 33 per cent.

Threat

“There is a real threat now, and we are determined to resist the move,” he added.

The unions have also opposed the move to merge public sector banks. He argued that the Government’s claim that this would consolidate banks and enable them to compete in international markets, where size was a critical factor, was only an excuse.

Mr. Rai said: “There is vast scope for public sector banks to expand in India. In any case, even if they consolidate all the Indian banks such an entity will be too small.”

Mr. Rai said that notwithstanding the talk of financial inclusion, only 53 new branches of banks had been established in “unbanked areas” in the past three years.

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