PROBLEMS NOT OF PSBs' CREATION: Economic Times
An edited version of the letter copied below has been published in today's (October 30, 2014)ET:
October
29, 2014
The
Editor
Economic
Times
Chat
Room
Right
diagnosis
This refers to ET
editorial “Fix Systemic Ills in State-Owned Banks” (October 29). In the
business of banking, success almost entirely depends on the men who man the key
positions in banks and the functional autonomy the banks enjoy within the
contours of the law of the land. In this context, the issues relating to
structural changes and market-related remuneration to staff including top
executives with appropriate safeguards for ensuring performance and
responsibility for decisions are much more relevant in public sector banks than
when banks were nationalised and enjoyed a monopoly of sorts in their area of
business.
Still, one is not able to
agree with the view that privatisation is a panacea for all ills or to go by
the idea that Axis Bank is a model to be followed. On the limited issue of the
criticism of banks in public sector, the question remains what prevents the
private sector catering to the needs of the huge clientele now served by public
sector banks. The private sector business interests do not allow them to
service the millions of accounts maintained by public sector banks, as their
primary interest is ‘more profits with less work’ and they look at the creamy
layer of the depositors and borrowers. The position will change only when the
government at the centre feels the responsibility of viewing nation’s
resources(whether in public or private sector or with individuals or other
organisations) as belonging to India as a country and guide their exploitation
and management in public interest. Let us not throw all the blame on public
sector banks.
M G WARRIER
Mumbai
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