The Hindu Business Line : Bank union sees need for floor lending rate

THE Monopolies and Restrictive Trade Practices Commissions (MRTPC)'s reported attempts at stopping bankers from reaching a consensus on industry-wise floor levels on lending rates has come under attack.

Emphasising the need for some informal floor rate and expressing concern over the MRTPC's moves, the All India Bank Employees Association General Secretary, Mr C.H. Venkatachalam, said that corporations, in the name of liberalisation, were arm-twisting the banks. `Select top-level corporates have this bargaining power and the banks, in a bid to retain their clients, relent to unviable propositions. Though bank managements are opposed to this unhealthy rate war, they nod to the dictates of the big borrowers. ,' he told Business Line.

On educational loans, he said `if the Government is really interested in the welfare of the people, it should come out with flexible educational schemes, instead of making the banks alone accountable and responsible. This is unfair.'

On issues such as extended banking hours, Mr Venkatachalam alleged that the Government on the one hand was talking of autonomy, while increasingly interfering into the routine matters of the bank. `We have as per our agreement, agreed to work even for 24 hours if the situation warrants, but are opposed to this unilateral eight-to-eight banking and the dictates of the Government'.

The extended business hours should be backed by adequate security, manpower and infrastructure support.

The AIBEA has have launched a national campaign to press for its their demand which, among others, include the need for recruitment and an end to outsourcing of jobs.