1)
The UFBU which had initially placed a demand for a 25 per cent pay hike stating
that public sector banks had made a net profit of Rs.37,000 crore during
2013-2014 fiscal later reduced its demand to 23 per cent. The Indian Banks
Association, however, has struck to its stand and asked the bank unions to
scale down the pay hike to 11 per cent saying that banks had suffered huge
losses.
The unions contended
that the banks could register 4.82 lakh trade profit in last few years with
expansion of banking activities across the country. Each employee used to
register Rs. 5.21 crore business in 2007 and it had gone up to Rs.12.13 crore,
indicating the robust business of all public sector banks in the country.
The government and IBA,
however, argue that there was a downward trend in profitability of banks. The
argument was far from reality as the banks’ operating profits have been
increasing. The NPAs were increasing due to wilful default of bank loans by
corporate and industrial houses. The bank employees and officers should not be
held responsible for it. In fact, only 12 per cent of the total establishment
expenditure was being spent towards salaries of the officers and award staff,
the protesters said
2) Crony Capitalism Thrives, PSU Banks Robbed Blind By JAY BHATTACHARJEE 7th December 2014
A few days ago, Reserve
Bank of India Governor Raghuram Rajan made an interesting observation. The
central bank chief hit out at Indian banks for disguising their bad debts by
numerous strategies, including writing them off. He also cited other dubious
methods of whitewashing off-colour balance sheets.
We must compliment
Governor Rajan for speaking out bravely and fearlessly, and bringing out in the
open one of the worst-kept secrets in Dalal Street and in the Indian financial
markets. These are the intricate machinations between Indian banks,
specifically the PSU banks, and their profligate clients who have borrowed
humongous sums of money from the former and conveniently defaulted on the
repayments. This is a very apt real-life demonstration of the old adage that a
borrower who owes a few thousand rupees to his banker is in real trouble, while
it is the other way round if he has borrowed a few hundred crores. This is, in
any case, what they teach in the finance and banking 101 courses in the MBA
schools these days.
Public sector banks in the country wrote off Rs 34,409 crore of
bad debts in the financial year 2013-14, compared to Rs 27,231 crore in the
previous fiscal year. This write-off accounted for
34 per cent of the Non-Performing Assets (NPAs) of the PSU banks. These figures
were disclosed by the finance minister a few days ago in Parliament but there
was little public reaction. It is as if Indians have either become blasé about
these enormous fiddles that are taking place openly or are too tired to raise
their voices. Governor Rajan’s data was even starker—according to him, the total amount of bad debts written off
by desi banks (overwhelmingly PSUs) in the last five years would have paid for
all the expenses of sending 15 lakh of the nation’s poorest children to the top
private universities in the country.-------------------
Despite plethora of laws, the manner in which Indian
corporates have taken the mickey out of the PSU banks gives a new twist to the
old phrase of laughing all the way to the bank. The most dismal aspect of the entire saga is the complete failure of
all regulatory agencies and organisations of the state, including the finance
ministry, the RBI, the Department of Company Affairs, SEBI etc. To this
potent mixture, add the judicial/court system and the legal community, and we
end up in this shambles. It is futile to classify the culpable parties
according to their guilt; this commentator feels that the wrongdoers in
this loot and scoot competition rank pari passu (a Latin term, used often by
hotshot lawyers, which means something that is equal in all respects). The only victims here are the Republic’s
hapless citizens.
--R.B.KISHORE
VP,AIRIEF
It is ATTITUDE, not APTITUDE which determines the ALTITUDELIFE is not a RIDDLE to be solved,it is a MIRACLE to be celebrated & sung.
