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Sitharaman puts out more reforms for India Inc. Click to know

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New Delhi: Finance Minister Nirmala Sitharaman addressed a press conference on Friday to unleash a new set of a reforms aimed at strengthening the economy. Saying that the focus is going to be on finance sector reform, Sitharaman announced a mega merger of 10 PSU banks to form four robust lenders and steps to ring-fence cash flows in the banking sector.

Here are the highlights:

  1. “After my previous announcement, 4 NBFCs are reaching out to public sector banks to provide the liquidity that they require.”
  2.  “We need to lay a strong foundation for the financial sector. We need to bring about banking reforms, as we have done in the previous years.”
  3. “Focus is on finance sector reform.”
  4. “Reforms we have brought about include the following- now, cash flows are ring-fenced. Business plans are implemented for a balanced asset mix, Fugitive Economic Offenders Act has been passed.”
  5. “This financial year, 14 public sector banks are in a profit-earning situation out of 18.”
  6. “Consolidation of Bank of Baroda, Vijaya Bank and Dena bank has brought about wide-ranging benefits.”
  7. “Market capitalisation is expected to reach 51,000 by August 2020. We are going to unlock growth potential through consolidation.”
  8. “Partial credit guarantee scheme for NBFCs executed; Rs 3,300 crore liquidity support given and Rs 30,000 crore in pipeline.”
  9. “To prevent Nirav Modi like frauds, SWIFT messages have been linked to the core banking system.”
  10. “Gross Non Performing Assets have come down from 8.65 lakh crores to 7.90 lakh crores.”
  11. “Punjab National Bank, Oriental Bank of Commerce and United Bank will be brought together and they shall form the second largest public sector bank with the business of Rs 17.95 lakh crore.”
  12. Canara Bank and Syndicate Bank are to be merged. They will be the fourth largest Public Sector Bank with Rs 15.2 Lakh crore business and the third largest branch in India. Synergies, culture and common CBS platform to enable a quick realisation of operational gains and enhanced lending capacity, said the finance minister.
  13. Union Bank, Andhra Bank, Corporation Bank to be merged. The mergers would help create next-generation banks. This would help India become a $5-trillion economy in the next five years.
  14. “Indian Bank to be merged with Allahabad Bank. This will become the seventh-largest bank in India.”
  15. “We shall continue with 2 banks which will have a national presence – Bank of India with Rs 9.3 Lakh Crores of business size and Central Bank with Rs 4.68 Lakh Crores of business size.”
  16. “Board committee of nationalised banks to appraise the performance of GM and above, says FM. Post consolidation, boards were given the flexibility to introduce CGM level as per business needs.”
  17. “12 PSU banks now, as compared to 27 PSU banks earlier.”
  18. “We will strengthen the Board committee system.”
  19. “We aim to enhance the effectiveness of Non-official Directors (NoDs).”
  20. “Staff should be dedicated at the branch level to make sure last Friday’s announcements are implemented and this consolidation is smoothly applied.”
  21. “I am not going to comment on remarks from Congress because if bank frauds became an assumption for the Indian citizen it is because of the Congress party. Many of these fugitives we are trying to get back were encouraged during their time.”
  22. “In the amalgamation process, the number of banks have been brought down to 12 from 27. There has been no retrenchment so far, there is no chance of retrenchment. The benefits of employment and HR will improve, with amalgamation the best combination will be taken up.
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  23. “The $5 trillion economy goal will be achieved through reforms, financial strength, technology, consolidation and strong governance. Rs 55,250 crore upfront capital for credit growth and regulatory compliance to support the economy.”
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