Delivering a Lecture recently at Columbia University, RBI governor Urjit Patel said since the cooperative banks and micro-financial institutions are there to take care of community needs and community-level banking, some banks could be merged to have a better banking scenario in the country.
This will also act as a quid pro quo for timely government technical injection. Patel called for consolidation of India’s public sectors banks into a more efficient banking system in order to deal with the problem of stressed assets, reports Business Line.
The apex bank governor added consolidation of banks could also entail sale of real estate where branches are redundant as well as offering voluntary retirement schemes to manage headcount and adding younger, digital—savvy personnel.
According to the RBI governor, divestment in public sector banks would have a positive role for the sector.