The Hindu : National : Krishna Iyer opposes bank merger move

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Krishna Iyer opposes bank merger move

Special Correspondent

KOCHI: V.R. Krishna Iyer, former Supreme Court judge, has urged Union Finance Minister Pranab Mukherjee to intervene in the issue of the merger of associate banks with the State Bank of India.

In a letter, he said the move was devoid of vision, especially because decentralisation was the essence of the progress of a nation.

The progress and prosperity of a nation depended on the happiness and well-being of the people, to which those in power were constitutionally oath-bound. Likewise, the prosperity and progress of an organisation depended on the well-being and happiness of its employees, apart from those benefiting from it.

The proposal to merge banks such as the State Bank of Travancore with the State Bank of India was much against the interests of the employees of the associate banks and their customers, he said. Any action by the authorities should be for the advantage and prosperity of the organisation and to safeguard the national interest. An examination of the effects of the merger showed that it would lead to the closure of rural branches. The move would appear to aim to pool the capital and resources of the subsidiary banks to meet the needs of global corporates.

Globalisation, privatisation and marketisation would only help big business and the corporate sector. The smaller banks took care and catered to specific economic activity, such as agriculture, small-scale industries and self-employment. The merger would hamper economic activity, much to the displeasure and discontent of customers, he said, and urged the Minister to allow the associate banks to maintain their identity.

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