Govt to work with RBI for execution of bank privatisation plan: FM Sitharaman

Finance Minister Nirmala Sitharaman has said that the government will work with the Reserve Bank of India for execution of the bank privatisation plan that she announced in the budget.

Speaking to newsmen, Sitharaman also said that the government has no plan to form any bank investment company to house the government stakes in banks.

In the Union Budget presented last week, Sitharaman had announced the privatisation of two banks as part of its disinvestment plan. Bank unions have opposed the move and have called for a two-day strike against the move.

“The details are being worked out. I have made the announcement but we are working together with the RBI,” she answered when asked about the proposal. She, however, declined to comment on any specific details about which will be the candidate chosen for privatisation.

On the bad bank, Sitharaman said that the “government may have to give some guarantee for the National Asset Reconstruction Company (ARC), but stressed that this is a solution which has come from the banks itself and will also be led by them.”

The Finance minister alleged that the banks’ non-performing assets which are to be transferred into the National ARC are a legacy of the mismanagement in the past.

On the Bank Investment Company (BIC), she said that no such proposal was on her table and wondered what resulted in the discussion.

“There is no such discussion. I don’t know where it is coming from. At least it is not before me. I am not discussing that,” she sternly answered.