Bank Of India, IOB & 2 Other Govt Banks Will Be Sold To Private Firms; Employees Oppose

We had earlier reported about the government’s plans of privatizing two PSU banks which Finance Minister, Nirmala Sitaraman mentioned in her budget speech. The names of the banks were unknown at that time. But now four mid-sized banks have been shortlisted by the government.

Which Banks Have Got Shortlisted For Privatisation?

Government has big plans of disinvesting in public sector banks so that it can generate revenues. For that government will put 2 public banks on sale at the start of next financial year i.e April 2022.

The banks which according to the government have the maximum potential to undergo privatization are the Bank of Maharashtra, Bank of India, Indian Overseas Bank, and Central Bank of India. The names are not officially announced but revealed by an anonymous source. 

Why Are These Banks Shortlisted?

As suggested by the officials, the government is going to proceed with this plan on a pilot basis. Hence for the trial or the first round, it has selected mid-sized banks. It may select bigger banks in the upcoming years.

Hence the shortlisted banks like Bank of India with 50,000 employees, Central Bank of India with 33,000; Indian Overseas bank with 26000; and Bank of Maharashtra with 13,000 working staff satisfied the requirements most appropriately.

Bank of Maharashtra with the least workforce runs ahead of others in getting finalized for privatization. Hence it has got the maximum potential of getting sold faster. According to sources, along with the number of employees, pressure from the trade union and political repercussions are also major factors that will affect the final decision.

Is Privatization Of Banks A Good Decision?

Privatization of banks can threaten the jobs of thousands of employees working in the sun run banks. However, the Modi government is optimistic about the initiative.

On the other hand, some of the experts feel that if the government is aiming to generate high revenues, it should focus on privatizing bigger banks like Punjab National Bank and Bank Of Baroda as small-sized banks won’t generate many resources.

However, some of the bank unions like All India Bank Officers’ Confederation (AIBOC) and All India Banks Employees Association (AIBEA) have come out in complete opposition. The associations have gone on strikes to protest against the decision as they feel that risk the dominance of the public sector banks.