Tag: bank union

The two-day strike by some 10 lakh bank employees, mostly from the public sector space, has severely disrupted banking services across the country, bank union leaders said. About 85 lakh cheques and other bank instruments were not cleared by bank branches in Mumbai alone on the first day of the strike as half a lakh bank employees joined the protest against the government move to privatise banks.

Almost all of the 8300 bank branches in West Bengal barring a few exceptions remained closed for the two days while about 90% of nearly 11,000 ATMs did not open their shutters, said Rajen Nagar, president of All India Bank Employees Association. United Forum of Bank Unions (UFBU), the umbrella organisation of nine bank unions, had called the strike.

UFBU said that instead of strengthening public sector banking, the present policies are aimed to weaken them, by starving them of the required capital, human resources, through disinvestment and proposed privatization.

“We demand strengthening of public sector banks, by adequate infusion of capital, human resources and strengthened statutory framework to recover the stressed assets,” UFBU’s West Bengal unit convenor Goutam Neogy said. Operating profit of all public sector banks grew 16.4% at Rs 174336 crore in fiscal 2019-20 despite an economic downturn showing the strength of these lenders. Their net profit however dwindled as the lenders had been required to provide aggressively against high non-performing assets.

The government had injected Rs 80,000 crore in 2017-18, Rs 1.06 lakh crore in 2018-19 and Rs 65,443 crore in 2019-20 in the banks it owns. The government has also budgeted to infuse another Rs 20,000 crore in weaker public sector banks, despite strains on government’s own finances.

“It’s not possible for the government to infuse capital every year while the capital is largely being used to cover bad loans. Therefore, new ways of raising capital is being looked at,” a senior banker said. The overall capital adequacy ratio for scheduled commercial banks stood at 14.8% as of March 2020, compared with 14.3% in March 2019. Capital adequacy for PSBs had improved 13% from 12.2% over the same period.