Not Privatisation, Operational Independence Is The Key For Banking Revival

The Public Sector Banks (PSBs) are in financial stress. Some serious measures have been taken to rescue these banks from the crisis. But those measures have only been partially successful. Ashok Kumar Pradhan, MD and CEO of United Bank India (UBI), spoke to BE’s Kishore Kumar Biswas.

- Ashok Kumar Pradhan

Q. How do you view the Indian economy from a banker’s perspective?

A. The economy is not in a pick-up mood. We are saddled with various issues which include low credit recovery. There have been a large number of stalled projects. We had been experiencing consumption-led growth earlier but it is not working out now. The growth rate of sale in the automobile sector is going down. The Non-Banking Financial Companies (NBFCs) crisis has been deepening day-by-day and the banking sector is yet to recover fully from the Non-Performing Asset (NPA) problem.

Q. Recovery of loan is a great problem. How are you dealing with it?

A. There are cases with the National Company Law Tribunal (NCLT), which are yet to be solved. It is taking more time than expected. In many cases, we are unable to recover our legal property. At times, we need enforcement of security for the possession of assets. District magistrates often do not give the decision. Sometimes, even after having permission, the police do not cooperate. We also face problem of delayed judgment from the Debt Recovery Tribunal (DRT).

Q. The rate of growth of bank lending has been low. A section of corporate entities is acquiring money through selling bonds, having external commercial borrowings and by other means. In this situation, can the PSBs survive depending only on credit to government, MSME, retail and agriculture sectors?