Bill to cut govt stake in banks likely soon

BANGALORE: The proposed bill to reduce government stake in public sector banks is likely to be introduced in the current session of the Parliament, according to minister of state for finance, Anandrao Adsul.
Mr Adsul said that the Centre was awaiting the report of the standing committee of MPs, who have been asked to study all issues concerning the dilution of equity. As may be recalled, the government has been planning to reduce stake in PSU banks to 33%, though the social nature of these banks will be retained.
Mr Adsul, who said that the 9% ‘Varishta Pension Plan’ would be launched nationwide on July 14, added that the ministry had been receiving requests to increase the upper age limit for pensioners, from 79 years at present.
Queried on the possible impact of the plan on government finances, Mr Adsul said that the government was committed to meeting its obligation to the aged and the pension plan.
Dispelling fears about the financial viability of the co-operative banking sector in the country, he said that a decision needed to be taken on the type of regulatory framework. “Co-operative banks function under Sec 49 of the Banking Regulation Act and hence come under the ambit of the RBI. We are not talking of interference from the Union government in these institutions,� he added.
Mr Adsul who was in Bangalore earlier reviewed the functioning of the PSU banks in the state. Commenting on the performance, he said that banks in south India had done well.
“PSU banks have done well in areas like priority sector lending where their exposure is 43-46 per cent against the mandated 40 per cent. In case of agri-lending the exposure is over 19.6 per cent against the minimum of 18 per cent,� he added.