Union Finance Minister Piyush Goyal on Thursday laid the blame for the banking sector crisis on the previous UPA government and said the Narendra Modi government would not repeat the same mistakes.
He said that the Centre will provide every possible support to public sector banks and bring them back on track as quickly as possible.
Holding "indiscriminate lending of the past" responsible for the present distress in the banking sector, he said: "We will ensure that what happened to the banking system in earlier years -- prior to 2014 -- is never repeated in future."
The remarks came after Goyal, who was given temporary charge of the Finance and Corporate Affairs Ministries until Arun Jaitley recovers from a kidney transplant operation, held a review meeting with the heads of public sector banks.
Goyal said Jaitley is "recovering very well" and that he had an opportunity to meet him on Wednesday to seek his advice on handling the ministry.
"He has given me some issues which, he believes, I should look into. I am following his guidance to ensure that for the short time that he remains indisposed, we can ensure that everything moves smoothly and ensure that we can quickly get the entire banking sector on its feet and shed the legacy that was inherited by this government in 2014," Goyal told the media.
"I am very confident that with the diligent efforts of all my colleague bankers, lakhs of employees of the public sector banks and all stakeholders in the banking system, working in close cooperation and under the guidance of our regulator RBI, we will ensure a very orderly growth of the sector and the highest levels of probity and accountability that is expected of these banks," Goyal said.
"We are very appreciative that finally, the Reserve Bank of India (RBI) is really ensuring proper banking supervision and is taking action against defaulters, something which I believe was not given the kind of serious attention that it deserved under the previous governments," the Minister added.
Goyal said the heads of the 11 banks present in the meeting shared "some very good ideas" to get the banks -- which are marred by frauds and bad debt -- out of the crisis.
He said the banks, along with his Ministry, will prepare an action agenda on a case-to-case basis.
"I am extremely confident that the public sector banks will be able to overcome these legacy issues in a very short period of time and will be able to continue to serve the common man through more aggressive banking while maintaining the highest standards of ethics and integrity," Goyal said.
The Central government will give every possible support to further strengthen the resolve of the public sector banks to come out of the Prompt Corrective Action framework as quickly as possible, he added.
The Minister said that during the meeting, the participants discussed how to maintain highest standards of transparency in the banking system and also the proposal for separation of risk management and lending so that risk assessment is given importance.
--IANS
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