At the “Breakfast with BL” event held in Chennai on Monday, Chief Economic Adviser Arvind Subramanian was quick with his quips, tongue firmly-in-cheek. Talking about the latest bank scam, he described the relationship between a bank owner, the government and the regulator as something akin to a ménage à trois .

As he explained, “We need to consider having majority private sector ownership and we need to combine that with much better supervision and regulation externally. When you have government ownership you basically have a complicated three-way relationship between a public sector bank, the regulator and the owner. This three-way relationship is something of a ménage à trois .”

The hour-and-a-half long conversation was peppered with many such quips and asides as the CEA interacted with industry leaders. Responding to a question on demonetisation, the CEA declared demonetisation “so yesterday”. On why the Finance Minister or the Prime Minister were silent on the PNB fraud, he said that while he had been speaking about the fraud case, he hadn’t been tracking what others said and therefore maybe he shouldn’t be speaking about it either.

While discussing how to fix broken internal controls which led to the Nirav Modi fraud case, the CEA spoke about how it wasn’t just the bankers that came out looking bad from this but also the auditors. He said that professional bodies like the chartered accountants institute need to do some serious self-reflection and added, “Then again, as someone famously said: self regulation is to regulation as self-praise is to praise.”

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