Up against privatisation, bank staff to strike on May 25

A leading bank employees’ union today said it has called for a strike on May 25 to protest against what it termed as the government’s attempt to privatise the banking sector.

About five lakh bank employees, including those from public, private, foreign, co-operative and regional rural banks, will participate in the one-day strike on May 25, C H Venkatachalam, General Secretary, All India Bank Employee’s Association (AIBEA), told reporters here.

Pressing for its demand, AIBEA will also stage a dharna before Parliament on April 26 and submit petitions to Prime Minister Narendra Modi. Making a case, Venkatachalam said banks in India deal with more than Rs 90 lakh crore of hard-earned savings of the public. “If it is privatised, ordinary people, including farmers, will be unable to secure loans easily,” he added.

He is worried that private banks would only deal with people involved in major business with a motive for profit. “Public sector banks are helping the common man in a big way and this will stop if banks are privatised. Yet, the government wants to privatise the banks and hand them over to private hands. Hence, we are opposing the move,” Venkatachalam explained.

He demanded that the government and Reserve Bank of India declare wilful default on loan repayments as criminal offence. He also sought action against liquor baron Vijay Mallya while urging the government to recover the loan of Rs 9,000 crore from him.

Meanwhile, government is looking at a scheme for encouraging its employees to invest part of their 7th Pay Commission salary hike in a fund which would be used for recapitalisation of state-owned banks. High income government official, according to sources, could be roped in to invest in the fund by offering lucrative incentives like tax break or higher return.

As per the proposal, higher income government staff from the rank of Section Officer may be asked to shell out 50 per cent of increased salary towards bank capitalisation bonds, the sources said. Top officials of the Finance Ministry had preliminary discussion over the issue last week, sources said.

However, no decision has been taken yet, they said, adding that Committee of Secretaries is looking into the matter and various alternatives are being considered. This proposal is being considered to find more resources for recapitalisation of public sector banks which are saddled with gross non-performing assets (NPAs) of Rs 3.61 lakh crore at the end of December 2015, as against Rs 39,859 crore in the private sector.

Gross NPA ratio as percentage of advances rose to 7.30 per cent while for private banks, it stood at 2.36 per cent as of December-end.