Karnataka - Bangalore   

‘India needs expansion, not consolidation’

Bangalore: The Karnataka Bank Employees’ Federation (KBEF), affiliated to the All Indian Bank Employees’ Association (AIBEA), celebrated the 40th anniversary of bank nationalisation, which commenced with the nationalisation of 14 private banks on July 19, 1969. Speaking at a meeting of bank workers to mark the occasion, H.V. Rai, general secretary of the KBEF, said the AIBEA had demanded nationalisation of banks so that “people’s deposits” could be used to serve public purpose.

“The results of nationalisation are there for everyone to see,” he said. The volume of deposits in the banking sector has increased 850 times since nationalisation, touching almost Rs. 40 lakh crore in 2009. Advances made by banks have increased 768 times in the same period, reaching Rs. 27.7 lakh crore in 2009. The branch network has increased from 8,268 to more than 52,000 after nationalisation, Mr. Rai said.

Mr. Rai said the country’s Public Sector Banks (PSB) have been a “shining example when global financial giants have collapsed like a pack of cards”.

However, he said PSBs have not yet achieved all the objectives of nationalisation. “Our banks have a long way to go,” he said.

He said the pursuit of “economic reforms” by the government, especially privatisation “is a real threat”. “Many banks have already touched the “lakshman rekha” of 49 per cent of ownership being in private hands,” he said. He said the move towards “consolidation” of banks, on the pretext of making them globally competitive, is “totally unwarranted”. “India needs expansion, not consolidation,” Mr. Rai said.

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