The Hindu Business Line : Public sector banks are globally competent, says Chidambaram

Pudukottai, May 12 The Union Minister for Finance, Mr P. Chidambaram, has come down heavily on criticism by a few political parties decrying the fiscal stability of public sector banks in the country.

The public sector banks, on the other hand, had improved upon their competency and efficiency on par with that of international banks, he said while speaking at a function to mark the inaugural of Indian Bank’s branch at Kuzhipirai village near Pudukottai on Monday.

To substantiate this, Mr Chidambaram said that one of the best examples was an outstanding performance by Indian Bank which was in the red till a decade ago, but made rapid strides thanks to the Centre’s timely grant of Rs 1,000 crore. “Indian Bank has registered a net profit of Rs 1,008 crore during 2007-08 and its non-performing asset has also decreased from 0.35 per cent last year to 0.24 per cent during 2007-08.

Loans for marginalised

He said that the Union Ministry of Finance has directed the public sector banks to sanction loans to the economically marginalised sections in rural areas for achieving overall socio-economic development of villagers.

The Ministry has recently issued an order directing the banks to sanction loans to cobblers, hair-dressers, carpenters, launderers and goldsmiths, who directly served our country’s rural society.

Pointing out that the nationalised banks accounted for over 70,000 branches across the country, Mr Chidambaram said the Ministry expected that at least 14 lakh persons would benefit every year.

A quarterly target of 35,000 beneficiaries had been fixed. In future, the number of beneficiaries would be increased.

For students

Mr Chidambaram appealed to the banks to sanction more loans to all eligible students to pursue the approved higher educational courses.

Till last year, the commercial banks had sanctioned about Rs 20,000 crore to 12.51 lakh students. Of them, about 1.17 lakh beneficiaries got loans from Indian Bank.

The Chairman and Managing Director of Indian Bank, Mr M.S. Sundara Rajan, said that this was the 1,5

46th branch of the bank. The branch had introduced inclusive banking services, facilitating depositors to invest the money with the bank.

The Union Minister of State for Environment and Forests, Mr S. Regupathy; theTirumayam MLA, Mr R.M. Subburam; and the Deputy General Manager and Circle Head (Tiruchi), Mr R. Ravi, were among those who spoke.