The Hindu Business Line : Consolidation: Agenda set for 7 leading PSU banks

THE Union Finance Minister, Mr P. Chidambaram, on Saturday put forth a new agenda for seven leading nationalised banks, asking them to draw up proposals for consolidation through the acquisition of smaller Government banks or other private banks.

Speaking to newspersons on the sidelines of the centenary celebrations of Bank of India here, he said the idea is to ensure that India has four-to-five `giant banks' that could match any reputed financial institution in the world.

"This is the task that faces the big banks today," he said. Mr Chidambaram said the Government would encourage any such consolidation proposal by the boards of the seven banks. He allayed apprehensions that a giant bank would become "distant and less friendly." He said, "These apprehensions are unfounded. We must remove these fears."

The seven leading nationalised banks that have assets worth more than Rs 50,000 crore each are State Bank of India, Punjab National Bank, Canara Bank, Bank of India, Bank of Baroda, Union Bank of India and Central Bank of India.

In response to a question, he said the rising oil prices could have an adverse impact on inflation, but the RBI and the Government are keeping a close watch on the situation.

`Most secular bank': Earlier, speaking on the occasion of Bank of India's centenary year, Mr Chidambaram described the bank as "India's most secular bank today." He suggested that each of the 42,000 employees of the bank should "go out and find five new customers for the bank in the next 12 months."

He added that each of the 2,594 branches of the Bank of India should identify a poor student, woman, farmer, dalit and artisan and "walk them through the next 12 months, providing them assistance to improve their lives." Such activities would truly commemorate a centenary year, he said.

Krishi card: The Finance Minister launched the bank's new Shatabdi Krishi Vikas Card, a credit card for farmers. The card can be used at ATMs and for purchasing agri-inputs. It is the combination of a credit card and a kisan card issued for crop credit. The bank claims that the new breed card is the first of its kind to be issued by any public sector bank in India.

The Maharashtra Chief Minister, Mr Vilasrao Deshmukh, was also present on the occasion.

Chronicling the growth of the bank, Mr M. Balachandran, its Chairman and Managing Director, said the bank's business mix is over Rs 1,38,000 crore. He said the bank was the first Indian bank to open an overseas branch way back in 1946 in London.

The bank was founded by a group of businessmen in Mumbai on September 7, 1906. It got associated with the Bombay Stock Exchange in 1921 and has been managing its clearing operations since then.

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