Bankers take up revamp plan with Kelkar

The finance secretary also met chiefs of financial institutions. According to sources, the issue of corporate governance came up for discussion at the meeting attended by Unit Trust of India chairman P Subramanyam and all Mumbai-based institutions.

At the IBA meeting, bankers focussed onfinancial support from the government, the problems in accessing the capital market, private placement or even going in for an overseas issue.

The issues of the government support in the area of empowering debt recovery tribunals for recovery of non-performing assets, getting greater autonomy, capital adequacy, tax administration, banking laws and corporate governance, Kelkar said after the meet.

"Restructuring is a big issue but the IBA had put forward a range of issues for which they need the government’s direct support," Kelkar said.

Among the other issues, the finance secretary also discussed about the integration of the forex and money market, non-asset lending, information technology and Y2k preparedness.

Kelkar emphasised the need to provide special attention to housing sector and to take steps like training of staff to successfully implement the new gold bond scheme. The government will take up the issues after it gets the detailed views of the members of the association on each of the issues,Kelkar said adding that the various banks had different requirements based on their individual problems.

The finance secretary said that he would meet the association periodically to asses the different issues. "Next time, I will discuss with them the human resource development issues,” he said.

The IBA made a special presentation on corporate governance before the finance secretary. The association called for a recast of ban boards by bringing in professionals and executive directors of banks on the board. "The banks must be board-driven. What we are looking for is empowerment of bank boards," IBA secretary MN Dandekar said.

In effect, the IBA wants dilution in the role of the banking division of the finance ministry. The IBA presentation had sought greater freedom for banks in recruitment, fixing of remuneration and freedom to engage employees on contract basis.