Defaulters on loans will be punished, says stern Arun Jaitley

The government will soon set up an expert group to look into consolidation of public sector banks as the country needs stronger rather than a large number of banks, Finance Minister Arun Jaitley said on Saturday. 

Gurgaon: The government will soon set up an expert group to look into consolidation of public sector banks as the country needs stronger rather than a large number of banks, Finance Minister Arun Jaitley said on Saturday. He also said the government is considering ESOPs for PSU bank officials besides strengthening the SARFAESI Act and Debt Recovery Tribunals to deal with the problems of stressed assets that are estimated at around Rs 8 lakh crore.

Finance Minister Arun Jaitley speaks in Gurgaon on Saturday. Pic/PTI

Addressing a press conference at the conclusion of the second edition of Gyan Sangam, Jaitley said that consolidation in the banking sector was discussed at the meeting and bankers themselves have suggested that an expert group should be set up soon to look into the issue. “We will consider that suggestion,” the minister said adding that the country needs stronger banks rather than large number of lenders. With regard to the rising Non-Performing Assets or bad loans, Jaitley said that besides strengthening the institutional mechanism, the government has been taking sector specific decisions to deal with the problems in segments like power, highways, sugar and steel.

Jaitley also said banks are taking steps to recover bad loans. “As far as recovery is concerned, whatever steps have to be taken with regard to recovery banks have various rights for recovery through DRT, SDR... Neither loan waiver has been given to anyone, nor will be given,” the minister said.

"Exciting news! Mid-day is now on WhatsApp Channels Subscribe today by clicking the link and stay updated with the latest news!" Click here!