It's Not Enough

CAPITAL INFUSION ALONE WON'T FIX THE PROBLEMS OF PSBs

- Anand Adhikari

A ₹2 lakh crore booty is making its way to the coffers of public sector banks (PSBs). The fresh capital infusion from the government will not only boost their ability to write cheques but also help deal with the ever rising provisioning requirement for the deteriorating asset quality.

But capital alone cannot fix the troubles of PSBs. They need more functional autonomy, lesser interference, succession planning, ESOPs, incentives, etc. Currently, there is no performance management or culture of meritocracy in state-owned banks. Barring State Bank o