Bank strike: 6 PSBs out of privatisation plan, govt to take a call on banks that will be privatised

15-03-2021

The United Forum of Bank Union (UFBU), an umbrella body of nine bank unions, has called for a two-day nationwide strike on March 15 (today and tomorrow) to protest against the government's plan to privatise two state-owned banks and retrograde banking reforms. Over 10 lakh PSU bank employees and officers are participating in the strike. Services such as deposits and withdrawal at branches, cheque clearance, and loan approvals are getting affected due to the strike as most of the junior level staff are participating in the strike. ATMs are functional at present but they may soon run out of cash because of non-replenishment. The agencies that load cash at ATMs take the cash from bank branches. But due to the strike, these agencies may face difficulty in getting cash from bank branches. According to a report in the Economic Times, government's think tank Niti Aayog has kept six public sector banks (PSBs) that were part of the last round of consolidation and State Bank India out of the privatisation plan. The other five PSBs are Punjab National Bank, Union Bank, Canara Bank, Indian Bank, Bank of Baroda. The government will soon take a call on the two banks and one general insurer that will be taken up for privatisation in the next fiscal year. The Niti Aayog’s recommendation to exclude these is in line with the thinking within the finance ministry that is keen on expeditious integration of systems at these banks, the publication mentioned. The Department of Investment and Public Asset Management will now take the proposal to a group of ministers. As part of the 2019 consolidation, Oriental Bank of Commerce and United Bank of India were merged into Punjab National Bank; Allahabad Bank with Indian Bank; Syndicate Bank was merged with Canara Bank and Andhra Bank and Corporation Bank with Union Bank of India. Mergers came into effect in the ongoing fiscal year, but banks are still to complete the process of integration. Indian Overseas Bank, Central Bank of India and UCO Bank are under the prompt corrective action framework of the Reserve Bank of India. They are expected to come out of it after the RBI reviews its decision following the announcement of fourth-quarter results of these banks. IDBI Bank has already come out of the framework. Banking is one of the strategic sectors under the new framework put up by the government. Under the policy, the government would have a limited number of state-owned entities in strategic sectors. The final number of entities in each sector including banking will be determined by a group of ministers.