Financial Daily from THE HINDU group of publications
Thursday, Dec 15, 2005
Financial Daily from THE HINDU group of publications Thursday, Dec 15, 2005 |
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Money & Banking
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Private Banks Move on voting rights opposed Our Bureau
Chennai , Dec 14 BANK unions are totally opposed to the dilution of the existing cap on voting rights at 10 per cent, said Mr C.H. Venkatachalam, General Secretary, United Forum of Bank Unions. A Parliamentary Standing Committee on Finance has given its approval to remove the 10 per cent cap on voting rights of shareholders of private sector banks as allowed by Section 12 (2) of the Banking Regulation Act. Terming the move as "highly unwise" and violative of the directive principles of State policy, Mr Venkatachalam said that this would be tantamount to handing over banks to foreign players. He added that if foreigners were to bring in a mere Rs 2,400 crore of capital, they would be able to control more than 75 per cent of the capital of 28 private sector banks. This would allow them access to and control of deposits of about Rs 3,25,000 crore.
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