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"Some recent incidents have been disturbing. Hope they are drop in the ocean and we learn lesson from these," he said while addressing the gathering at the Foundation Day of state-owned Indian Bank.
This is first formal statement from the finance minister after Syndicate Bank Chairman SK Jain was arrested by the Central Bureau of Investigation (CBI) on the charges of bribery. The government has also initiated a forensic audit at the Oriental Bank of Commerce and Dena Bank after the lenders came under CBI lens for alleged misappropriation of funds worth Rs 436 crore from their fixed deposit customers.
"We expect banks to have better risk management and professionally-run management. The Department of Financial Services is working in this regard," Jaitley added.
Questions were raised about the quality of bank boards after these cases of irregularities in banks came to the fore. The poor oversight couple with an economic slowdown has resulted in filing up of bad loans of government banks.
"Indian banking conventionally has been professional and conservative. That's why we survived the sub-prime crisis. Hope the level of professionalism will continue and enhance. Credibility is most important for the banking sector. We must continuously endeavour to raise those standards," Jaitley said.
