Arun Jaitley said merger would create a bigger entity like SBI.New Delhi:Finance Minister Arun Jaitley on Friday said in Lok Sabha that there would be no loss of jobs due to merger of public sector banks.
Earlier this week, Cabinet approved merger of Vijaya Bank and Dena Bank with Bank of Baroda.
Mr Jaitley said that there would be no job losses due to merger of banks and that move would create a bigger entity like State Bank of India (SBI).
The cost of lending could also become cheaper, he added.
During Question Hour, minister said that out of 21 public sector banks, 11 are under PCA (Prompt Corrective Action) framework.PCA is initiated against banks that have high levels of non-performing assets (NPAs).
Replying to a supplementary question, Mr Jaitley said curve of non-performing assets would go down and that Insolvency and Bankruptcy Code has helped in bringing back around Rs 3 lakh crore into system.Mr Jaitley said that State Bank of India (SBI) and other public sector banks have been making operational profits.
They incurred losses due to provisioning for non-performing assets, he added.With regard to recapitalisation of public Sector Banks (PSBs), minister said that Rs 51,533 crore has been infused into them in current financial year till December 31."In budget estimates of FY 2018-19, Rs 65,000 crore has been allocated for recapitalisation of PSBs and an amount of Rs 51,533 crore has been infused in PSBs till December 31, 2018," he said.
The minister also said that in recent past, Rs 90,000 crore was allocated in Union Budget and infused in various PSBs by government during financial year 2017-18.