Banks told to lend without being “unduly conservative” but in a transparent manner
Minister for finance, corporate affairs and I&B, Arun Jaitley (left) and financial services secretary Hasmukh Adhia, at a meeting with the CMDs and CEOs of public sector banks and financial institutions, in New Delhi on Thursday. - PTI
New Delhi: To boost growth, finance minister Arun Jaitley on Thursday asked state owned banks to increase credit flow to various sectors as “credit is lifeline of an economy.” During quarterly review meeting of PSBs and other FIs by the finance ministry, they were told to lend without being “unduly conservative” but in a transparent manner. “This would boost the economy and enable an asset book of high quality.”
The banks were advised that greater effort was needed to ensure smooth access to credit to various sectors to facilitate rapid growth in economic activity, “which was a key priority of the new government.”The state-owned banks were told that sectors including agriculture, MSME, housing and education required particular focus. The finance minister said that global growth is quite patchy and direction of global investment is still unclear.
“There is great opportunity for India to attract foreign investment and large numbers of international entrepreneurs are showing their keen interest in India. Their capital is comparatively less costly than ours and once it starts flowing than it will definitely impact us positively,” Mr Jaitley said while addressing the heads of Public sector Banks (PSBs) and financial institutions during the review meeting here.
The finance ministry on its part said that it was committed to keeping the public sector banks adequately capitalised. The ministry said that it will be infusing '11,200 crore in public sector banks shortly. Mr Jaitley said that government has taken steps to streamline the process of appointment of chief executive officers (CEOs) and executive directors (EDs) of PSBs to introduce objectivity in the process. This will play a major role in making them a professional organisation, he added.
( Source : dc correspondent )
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