The government is “actively working” towards consolidation of banks, said Finance Minister Arun Jaitley on Monday. The meeting of top bankers with the finance minister, where ministry officials and RBI Deputy Governor S S Mundra were present, was called to take stock of lenders’ financial position and speedy resolution of bad assets.
“Consolidation of banks was not on the agenda as far as this present meeting is concerned. But I can tell you, we are actively working in that direction,” Jaitley told reporters at a question-answer session, post first round of the discussions.
“I can’t give you further details because some of these are price sensitive, but you can take it that there is a movement going on in that direction,” he emphasised. The minister hinted that a solution is coming very soon.
Public banks are sitting on a mountain of bad loans to the tune of over Rs 6 lakh crore at the end of 2016-17. A top ministry official said there is no option but to resolve the NPAs as far as the sectoral source is concerned. Rules have been framed for the six such large sectors and task forces have been on the job.
“We worked out four refined institutional ways in which banks can actually put their points across to the task force to the specific sector and telecommunication is one of them. In each of the sectors, there is no option but to resolve as you go along,” the official stressed.