No loss of jobs from PSBs merger: Jaitley

Finance Minister Arun Jaitley on Friday asserted in Lok Sabha that there would be no loss of jobs due to the proposed amalgamation of public sector banks - Bank of Baroda, Vijaya Bank and Dena Bank. This assurance comes on the heels of the Cabinet approving the merger of Vijaya Bank and Dena Bank with Bank of Baroda .

Stating that there would be no job losses from the consolidation among public sector banks, Jaitley noted that such a move would create a bigger entity on the lines of State Bank of India. The amalgamation would result in making the cost of lending cheaper, he added.

In the earlier days, banks were being looted, now banks are being saved, Jaitley noted, sending many members to protest over the implication of the minister’s statement.

It may be recalled that the Union Cabinet had while approving the scheme of amalgamation of Bank of Baroda, Vijaya Bank and Dena Bank said that every permanent and regular officer or employee of the transferor banks (Vijaya Bank, Dena Bank) will become an officer or employee and will hold his office or service therein in the transferee bank (Bank of Baroda).

Also the pay and allowance offered to the employees/officers of transferor banks will not be less favourable as compared to what they would have drawn in the respective transferor bank.

During the Question Hour, Jaitley said that curve of NPAs would go down and that the Insolvency and Bankruptcy Code has helped in bringing back around ₹ 3 lakh crore into the system in last two years. Jaitley highlighted that the State Bank of India (SBI) and other public sector banks have been making operational profits. They incurred losses due to provisioning for non-performing assets, he added.

On recapitalisation, Jaitley said that an amount of ₹ 51, 533 crore has been infused into PSBs so far this fiscal. The Centre had in this year’s budget provided ₹ 65,000 crore towards capital infusion in banks. Jaitley also made it clear that Government would not interfere in the autonomy of the RBI in taking monetary policy decisions.

Meanwhile, in a written reply to another Lok Sabha question, Jaitley said there was no misappropriation of Punjab National Bank’s pension and gratuity funds in the past and no amount was taken from the trusts' account. He was responding to a question by BJP MP Kirit Somaiya as to whether the Government was aware of the misappropriation of the Employees' Pension Fund Trust and Gratuity Fund by PNB in 2016-17.

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