No harm to Banking Sector With Privatization of Few PSB's : SBI Chairman

State Bank of India Chairman Rajnish Kumar has said in recent communication that privatization of some of the public sector banks will not do any harm to the banking sector or the economy of the country, and the emphasis should be on the way any institution is governed, instead of who governs it. 

Further he added that 

"We have a scenario where we have State bank and at least six large public sector banks post-merger to take care of any social agenda of the government, and rest of the banks can be in the private sector.” 

He also said that "My view has always been that ownership should not matter. Whether the government holds 55 per cent or 40 per cent equity, the emphasis should be on the way any institution is governed, which is more material factor,” said Kumar, adding: “We have badly-governed private sectors and also well-governed public sectors.” 

Government Strategic Sector Policy

Privatization of Few PSB's

It is to be noted that the government has recently proposed a new policy to have not more than four public sector undertakings (PSUs) in each ‘strategic sector’. Noting that private banks should create a niche for themselves in order to be competitive.
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