The editorial, "The banking agenda" (January 5), has dissected the working of the public sector banks over the last four decades succinctly and given worthy suggestions in addition to the recommendations of the P J Nayak committee. With Prime Minister Narendra Modi announcing at the two-day Gyan Sangam in Pune that there won't be any interference from the government, the working of nationalised banks has come full circle over the last 45 years.
While discussions on reforming banks' structure and working will continue for some time, it may be worthwhile to consider radically diluting the holding of the government to 40 per cent (by way of offer for sale and also further capitalisation at a substantial discount to the market price). This way, the government can still have strategic ownership control, but billions of rupees in bank fixed deposits by millions of investors would be released. They could then be the stakeholders in these banks and reap the long-term benefits of equity participation.
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While discussions on reforming banks' structure and working will continue for some time, it may be worthwhile to consider radically diluting the holding of the government to 40 per cent (by way of offer for sale and also further capitalisation at a substantial discount to the market price). This way, the government can still have strategic ownership control, but billions of rupees in bank fixed deposits by millions of investors would be released. They could then be the stakeholders in these banks and reap the long-term benefits of equity participation.
Naresh Saxena, New Delhi
Letters can be mailed, faxed or e-mailed to:
The Editor, Business Standard
Nehru House, 4 Bahadur Shah Zafar Marg
New Delhi 110 002
Fax: (011) 23720201 · E-mail: letters@bsmail.in
All letters must have a postal address and telephone number