Number of PSBs may come down to 8-10: Jayant Sinha

28 May,New Delhi

The number of public sector banks currently at 27 may come down to 8-10 soon if the NDA Government gets it way.”We have 27 public sector banks right now. When the dust settles, I think we will have maybe eight or ten very competitive banks. Some of them are going to be large scale global players, some of them are going to be differentiated banks,” said Minister of State for Finance Jayant Sinha while addressing an event here Saturday.

He stated, “We are doing all the things necessary to really ensure that these banks are vibrant, are competitive and a huge sort of reform agenda we have underway for the banks right now… and of course we are now in the third phase of that.”

“We have gone through governance and management reforms, we have gone through the asset quality review…and now we are in the consolidation phase where we are really trying to ensure that at the end of this consolidation phase, we have a set of competitive banks,” Sinha elaborated.

He added: “If we let our public sector institutions like banks, Air India, BSNL/MTNL languish so that they are not competitive, it is akin to a “de facto privatisation”.

“In this de facto privatisation, rather than the value of those enterprises built up over decades with public money going to the public, it goes to the disruptive entrepreneurs or whoever it is who are able to take share away from these public sector enterprises…,” he said. ”

There will be de facto privatisation of wealth. We may have some billionaires because of this, but ultimately it is people who will be suffering,” he said.