AIBOC sets up independent commission on banking issues
Mumbai: The All-India Bank Officers' Confederation (AIBOC) has decided to set up an Independent Commission on Banking & Financial Policies with S.P. Shukla, former Finance Secretary, as the Chairman.

According to AIBOC, the commission will have experts from various fields who will address questions relevant to the banking sector. The questions posed to the committee are:

a) Was the nationalisation of banks in 1969-80 and the subsequent developments in the banking sector till 1991 in furtherance of the declared economic priorities of the country?

b) What were the failures, if any, of the banking system which impinged on the larger economic issues?

c) What will be the impact of the changes taking place in the banking industry now in relation to ownership, liberal branch licensing, free entry to Indian and foreign players, profits and the likely mergers on basic developmental issues?

d) Will mergers and amalgamations of banks serve the larger public interest?

e) Without sacrificing commercial interests what could be an alternative model of banking that can meet the fundamental developmental issues?

The latest move to give preference to foreign banks based in Singapore for acquiring a creeping stake in Indian private banks has caused disquiet amongst the unions and the question being posed by them is whether there are any guarantees that Indian banks would be allowed similar stakes in foreign banks in their own countries?
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AIBEA: Debar defaulters from holding public positions
Hyderabad: The All-India Bank Employees Association (AIBEA) has demanded that the Government bring in legislation to debar bank loan defaulters from contesting or holding any public positions in State Assemblies and Parliament.

Apart from demanding the publishing of the list of defaulters, the unions have also called for stern action against them. AIBEA, the world's largest bank employees' union, with a membership of over five lakhs, has also asked the Government to further strengthen the Securitisation Act to provide for attachment of personal properties of the defaulters.

"If these steps are not taken up by the Government, we will once again revive a campaign on these issues and also launch countrywide agitation. The latest list of the bad loans will also be published shortly," association officials have said.

According to the officials, AIBEA is demanding that the Government take over all the 29 private banks in the country without giving scope for their acquisition by foreign banks. He opposed the Government's announcement to allow foreign banks to take over the private banks, which had total deposits of Rs.2.75 lakh crore. The Government's move will enable the foreign banks to easily acquire the Indian private banks with just Rs.2,800 crore of investment, the officials said.

AIBEA has also opposed the Government's move to merge the 27 public sector banks into a few strong and globally competitive entities. Stating that the public sector banks (PSBs) were having over Rs.13 lakh crore of deposits and meeting social commitments, association officials said the public savings should be left available for development and welfare activities of the people. Further, the merger of PSBs would result in the closing down of thousands of bank branches, and lakhs of bank employees would be retrenched.

The association has warned that if the Government and the bankers try to proceed with mergers unilaterally, the bank employees will express their protest through agitations and strikes, besides seeking political support.
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Unions oppose merger of BoI and Union Bank
Mumbai: Bank unions have threatened to oppose the proposed merger of Union Bank of India with Bank of India. All India Bank Officers Confederation (AIBOC) officials have said that the union will go on strike immediately if the Government goes ahead with the proposal According to banking circles, the Finance Ministry has sent the merger proposal to the Reserve Bank of India for its view, which is expected to work out a scheme of merger. The unions are against mergers as it will result in loss of employment. In this case, both are large banks and have been running profitably, a union official said.

In general, it is estimated that consolidation of banks may result in surplus staff of nearly 25 to 30 per cent. In rural branches, mergers could result in the closure of 30 to 40 branches.

Besides opposing the merger, the union also has other demands, such as the immediate recruitment of 25,000 officers and discussions on service-related issues of officers.

The Finance Minister, P. Chidambaram, has been reiterating that consolidation alone will give banks in India the muscle, size and scale to become world-class banks. The Indian Banks' Association recently came out with a report on the banking industry, in which it suggested the "corporatisation" of public sector banks to simplify the process of consolidation.

The confederation has set up an independent committee on alternative banking and financial policies, under the chairmanship of a former Finance Secretary, Mr S.P. Shukla.
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