FM to meet banking top guns today

Finance minister P Chidambaram will meet the top officials of the banking and financial sector in Mumbai tomorrow.

His day will start with a meeting with the central board of the State Bank of India, followed by a meeting with M Damodaran, chairman of Industrial Development Bank of India Ltd, senior income tax officials and officials from the Securities and Exchange Board of India (Sebi).

SBI insiders insisted that the FM's annual tryst with the central board of the country's largest commercial bank is a routine affair where the bank's chairman A K Purwar will appraise the FM about initiatives of the bank.

However, analysts found it significant as SBI has been scouting for banks overseas to add to its balance sheet. The FM is also expected to take stock of the credit delivery to the agricultural sector, a source said.

Chidambaram will meet Damodaram to review the functioning of the financial institution in its new avatar as a bank. The government has given IDBI Rs 9000 crore to create a Stress Asset Stabilisation Fund (SASF) worth Rs 9,000 crore and clean its balance sheet.

He is also expected to oversee the progress made towards integrating the two institutions IDBI and IDBI Bank, sources added. The SASF was a special purpose vehicle created through a budgetary announcement to transfer Rs 9,000 crore of stressed assets from (IDBI) to clean up its balance sheet.

Sebi officials are expected to appraise the FM with the recent developments in the capital market and the reasons for the crash in the Sensex on Wednesday.

Chidambaram will be in Mumbai to attend the three day conference Pravasi Bharatiya Diwas Samaroh organised by the ministry of overseas Indian affairs in association with the Federation of Indian Chambers of Commerce and Industry starting tomorrow.