Skip to main content

Govt of India goes ahead with 'deep-rooted' conspiracy to kill public sector banks

By Thomas Franco* 

The Finance Minister recently announced that government business handled by the government banks, i.e. public sector banks, will also be provided to the private sector. Already certain government businesses have been slowly handed over to the new generation private banks. State bank of India (SBI) was handling 99% of the government business at one point in time. Now it has come down to 58%.
​The government’s attempt may appear trivial to many, but the deep-rooted conspiracy is to kill the public sector banks by depriving them of not only government business but government deposits, government accounts, salary accounts of government and public sector employees and make it difficult for them to compete.
​While taking away the government business from the government banks, the Prime Minister also declares that government banks should increase the lending under government schemes. Let us look at some statistics.
Out of the total Jan Dhan accounts opened even with zero balance, less than 3% of the accounts are opened by private banks though they handle more than 30% of the total advances and deposits. As of February 24, 2021, there are 42.92 crore Jan Dhan accounts. Out of this 33.17 crore accounts are handled by public sector banks, with 15.53 crore accounts opened by SBI alone, which are unremunerative, and banks incur a cost in opening the accounts.
Out of total Jan Dhan accounts opened even with zero balance, less than 3% were opened by private banks
Arundathi Bhattarcharya, when she was chairperson expressed openly that her request to government to reimburse the cost of expenses on these accounts did not yield result and she increased the service charges like minimum balance charges, ATM charges, loan processing charges etc affecting the common men and women.
​Regional rural banks, which are also public sector banks, have opened 7.50 crore Jan Dhan accounts whereas private banks have opened only 1.25 crore. Similarly, in the case of Mudra Loans, public sector banks and regional rural banks have contributed a lot through direct loans and loans to non-banking financial companies.
​If we take SBI as an example, we can understand the contribution of public sector banks and how they indirectly benefit. As of March 2020, SBI had 44.89 crore customers, 22.84% of the market share in deposits, 19.69% of the market share is advances, 22,141 branches, 58,555 ATMs, 61102 business Correspondent outlets and handled Rs.52,62,643 cire government business.
Though the remuneration for handling government business is less than the expenditure to manage them, government Deposits are held with SBI. Most of the salary accounts were with SBI, including defence personal. Now Kotak Mahindra bank has signed an agreement for accounts of army personnel.
​In the last one year, SBI had given 36 crore housing loans. Most of them would be backed by salary accounts. Rs 2,19,062 crore personal loans were disbursed in a year which also would be backed by salary accounts under the express credit schemes.
​SBI and other public sector banks also handle other unremunerative schemes of the government like PM Jeevan Jothi Bima Yojana, PM Suraksha Bima Yojana, Atal Pension Yojana. They also run Rural Self Employment Training Institutes (RSETIs) to provide skills to unemployed youth. SBI alone has 152 RSETIs and 341 Financial Literacy Centres, which conducted 29,995 camps on financial literacy last year alone.
​SBI alone has spent Rs 27.47 crore on corporate social responsibility. In the last one year, SBI has given 76,572 education term loans and disbursed Rs 8,777 crore and handled 44,24,777 kisan credits.
​By taking away the government business, banks will lose government commission on government business, lose government deposits, lose salary accounts which all will lead to a reduction in income. But under pressure, they will continue to give loans under government schemes like Mudra Yojana, which turn into non-performing assets (NPAs) very quickly. This reduction in business will lead to a reduction in staff strength.
​These banks only implemented the demonetisation schemes without any financial support from government and lost a lot in collecting, handling and disposing of the old currency. After milking the Public banks so much, now the government wants them to go to Goshala and die a natural death. It is the government policies that increase the NPA, and the government wants to kill the government banks without understanding the consequences.
---
*Former general secretary,  All India bank Officers’ Confederation. Source: Centre for Financial Accountability

Comments

SAMIR SARDANA said…
THE ENTIRE INDIAN BANKING SYTEM,IS DESIGNED,AS A TOOL FOR THE NETAS,TO LOOT THE INDIAN PEOPLE – LIKE A TAX ,OF SAY , 5% OF THE INCREMENTAL BANK DEPOSITS, IN A YEAR – BY STEALING THE LOANS MADE TO THE CRONIES,OF THE NETAS !

Y DO BANKS LEND TO THE PROPERTY SECTOR, AND NOT DECLARE OR DISCLOSE FRAUDS ? IT IS TO KEEP THE PROPERTY SECTOR BLOATED AND AFLOAT. UNLESS THERE ARE 3-5 LACS CRORES OF PROPERTY LOANS EVERY YEAR – THE RESALE MARKET WILL BE DEAD – AND PRICES WILL CRASH – AND IF NEW PROJECTS ARE NOT FUNDED, THEN STEEL, CEMENT AND FURNISHING SALES WILL CRASH. SOME PEOPLE SAY THAT BY FUNDING NEW PROJECTS – BANKS ARE INCREASING SUPPLY AND LOWERING PRICES ! NONSENSE! BANKS LEND TO THESE PROJECTS – KNOWING THAT THE PROJECTS WILL BE STALLED – “BUT THE LAND WILL BE BLOCKED ,AND WILL NOT ENTER THE SUPPLY SIDE OF THE EQUATION”

THAT WILL CREATE A LAND SQUEEZE,AND CREATE A “PUT OPTION” ON THE PROPERTY PRICES.ALL THIS BENEFITS THE NETAS ALSO – AS THEY OWN BILLIONS OF USD OF BENAMI AND LEGAL LAND – AND THE LAND BOUGHT BY THE DEVELOPERS, IS THAT OF THE NETA ( PURCHASED AT INFLATED PRIICES – AND SO,THE NETA COERCES THE BANKS ,TO GIVE THE LOANS)

BUT THE BANKS ARE THE BIGGEST SCAMSTERS,AS THEIR ENTIRE CREDIT PORTFOLIO,FOR ALL SECTORS – HINGES ON THE COLLATERAL OF LAND AND PROPERTY PRICES – AND IF THAT CRASHES – EVERY THING WILL CRASH !

THAT IS Y BANKS DISCLOSE BANK FRAUDS IN THE PROPERTY SECTOR, 5-8 YEARS – AFTER THE FRAUD HAS OCCURRED – WITH THE RBI BLESSINGS – SO THAT THE DEVELOPERS AND NETAS HAVE ENOUGH TIME TO STEAL AND VAMOOZE,AND THE PUBLIC (WHO BOOK THE FLATS ARE CONNED)

LOOK AT THE TIL FRAUD ON CANARA BANK ! THE ACCOUNT WAS A SUBSTANDARD ACCOUNT IN 2014,AND WAS DECLARED A FRAUD,IN 2020 – AFTER A FIR WAS FILED BY UNION BANK ! CANARA BANK DID NOT DECLARE IT AS A FRAUD,OR FILE THE FIR (ALTHOUGH THEY WERE THE LEAD BANKER).

Y ?

THEY WERE THE PLANNERS OF THE SCAM AND THE BORROWER WAS A TDP MP – WHO OWNED CAN BANK. ELSE,THE BORROWER COULD HAVE CHOSEN SBI AS THE LEAD – BUT IT DID NOT – AS THE AIM WAS TO RIP OFF THE BANK ! TO ENSURE THAT THE TDP MP WAS NOT TAINTED FOR 7 YEARS AND THE CHARGESHEET WAS NOT STATED, IN THE ELECTION COMMISSION AFFIDAVITS – CANARA BANK DID NOT FILE A FIR OR DECLARE THE BANK FRAUD ! dindooohindoo

TRENDING

Avoidable Narmada floods: Modi birthday fete caused long wait for release of dam waters

Counterview Desk  Top advocacy group, South Asia Network on Dams, Rivers and People (SANDRP), has accused the Sardar Sarovar dam operators for once again acting in an "unaccountable" manner, bringing "avoidable floods in downstream Gujarat."  In a detailed analysis, SANDRP has said that the water level at the Golden Bridge in Bharuch approached the highest flood level on September 17, 2023, but these "could have been significantly lower and much less disastrous" both for the upstream and downstream areas of the dam, if the authorities had taken action earlier based on available actionable information.

From 'Naatu-Naatu' to 'Nipah-Nipah': Dancing to the tune of western pipers?

By Dr Amitav Banerjee, MD*  Some critics have commented that the ecstatic response of most Indians to the Oscar for the racy Indian song, “Naatu-Naatu” from the film, “RRR” reeks of sheer racism, insulting visuals and a colonial hangover. It was perhaps these ingredients that impressed the Academy of Motion Picture Arts and Sciences, one critic says.

Buddhist shrines were 'massively destroyed' by Brahmanical rulers: Historian DN Jha

Nalanda mahavihara By Our Representative Prominent historian DN Jha, an expert in India's ancient and medieval past, in his new book , "Against the Grain: Notes on Identity, Intolerance and History", in a sharp critique of "Hindutva ideologues", who look at the ancient period of Indian history as "a golden age marked by social harmony, devoid of any religious violence", has said, "Demolition and desecration of rival religious establishments, and the appropriation of their idols, was not uncommon in India before the advent of Islam".

A Hindu alternative to Valentine's Day? 'Shiv-Parvati was first love marriage in Universe'

By Rajiv Shah*   The other day, I was searching on Google a quote on Maha Shivratri which I wanted to send to someone, a confirmed Shiv Bhakt, quite close to me -- with an underlying message to act positively instead of being negative. On top of the search, I chanced upon an article in, imagine!, a Nashik Corporation site which offered me something very unusual. 

Biden urged to warn Modi: US can declare India as worst religious freedom offender

By Our Representative  During a Congressional Briefing held on Capitol Hill, Washington DC, Nadine Maenza, former Chair of the United States Commission on International Religious Freedom (USCIRF), has wondered why the Biden administration should raise issues of mass anti-minority mob violence  -- particularly in Haryana and Manipur -- with Modi. Modi should be told that if such violence continues, the US will be “compelled by law” to designate India as one of the world’s worst offenders of religious freedom, she urged.

Savarkar 'criminally betrayed' Netaji and his INA by siding with the British rulers

By Shamsul Islam* RSS-BJP rulers of India have been trying to show off as great fans of Netaji. But Indians must know what role ideological parents of today's RSS/BJP played against Netaji and Indian National Army (INA). The Hindu Mahasabha and RSS which always had prominent lawyers on their rolls made no attempt to defend the INA accused at Red Fort trials.

Asset managers hold '2.8 times more equity' in fossil fuel cos than in green investments

By Deepanwita Gita Niyogi*  The world’s largest asset managers are far off track to meet the  2050 net zero commitments , a new study  released by InfluenceMap , a London-based think tank working on climate change and sustainability, says. Released on August 1, the Asset Managers and Climate Change 2023 report by FinanceMap, a work stream of InfluenceMap, finds that the world’s largest asset managers have not improved on their climate performance in the past two years.

Evading primary responsibility, ONGC decides to invest Rs 15,000 crore in sick subsidiary

By NS Venkataraman*  It is reported that Oil and Natural Gas Corporation (ONGC) will infuse about Rs 15,000 crore in ONGC Petro-additions Ltd (OPaL) as part of a financial restructuring exercise. ONGC currently holds 49.36 per cent stake in (OPaL), which operates a mega petrochemical plant at Dahej in Gujarat. GAIL (India) Ltd has 49.21 per cent interest and Gujarat State Petrochemical Corporation (GSPC) has the remaining 1.43 per cent.

'State-sanctioned terror': Stop drone attack on Adivasis, urge over 80 world academics

Counterview Desk  A joint statement, “Indigenous Peoples’ Un-Freedoms and Our Academic Freedom: A Call for Solidarity”, endorsed by over 80 signatories, including international academics, activists and civil society organizations, as well as diasporic Indian academics and researchers, working with Adivasi (indigenous) communities in India, has made an urgent appeal to prevent future drone bomb attacks by the Indian state on Adivasi villages.

Sales, profits of Indian firms 'deteriorate', yet no significant increase in cost pressures

By Our Representative  The Indian Institute of Management-Ahmedabad's (IIM-A's) latest Business Inflation Expectations Survey (BIES), a monthly exercise, has said that while cost perceptions data does not indicate significant increase of cost pressures, sales and profits of the Indian firms have deteriorated.