Money & Banking

Cabinet approves PFRDA, SBI Subsidiary Banks Bills

Our Bureau New Delhi | Updated on March 17, 2011

The Union Cabinet has approved the tabling of a revised Pension Fund Regulatory and Development Authority (PFRDA) Bill in the current session of Parliament.

It has also decided to push for the passage of the State Bank of India (Subsidiary Banks Laws) Amendment Bill, 2009 in this session, which is to end on March 25.

The PFRDA Bill basically seeks to grant statutory status to the pension sector regulator, which currently does not have quasi judicial powers unlike the Reserve Bank of India or the Securities and Exchange Board of India.

The second Bill would enable the five associate banks of SBI to raise their capital by issuing equity shares through the public or preferential allotment/private placement. That would, in turn, require dilution of SBI's share in these banks.

The PFRDA Bill may have to be referred to a Parliamentary Standing Committee (since it is a new Bill, even if a revised version of an earlier one tabled in 2005).

The SBI (Subsidiary Banks Laws) Bill, on the other hand, has been referred to the Standing Committee on Finance, which has already submitted its report. This Centre would, therefore, seek to get it passed in the current session itself, after incorporating the Standing Committee's recommendations.

In his Budget speech, the Finance Minister, Mr Pranab Mukherjee, had referred to the two Bills, along with five other financial sector legislations that “I propose to move”.

Published on March 17, 2011

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