In the midst of the ongoing merger of the first of three public sector banks, Rajnish Kumar of the State Bank of India (SBI) said India had too much PSB and that the merger process was inevitable . In an interview with ET Now, the SBI chief said that 21 PSBs are too numerous and their number needs to be reduced, echoing the popular opinion.
Rajnish Kumar was asked if the idea of merging two strong banks – Bank of Baroda (BoB) and Vijaya Bank – with a weak bank, a good idea, to which he responded that it was a recommendation made in 1992. "The merger must begin someday," Rajnish Kumar told the news channel.
On September 17, the Narendra Modi government announced the proposed merger of the three banks with the aim of making the entity the third largest bank in India. The boards of directors of the three banks have approved the merger plan.
In another interview with CNBC-TV18, Rajnish Kumar tried to calm fears over the non-bank finance company (NBFC) crisis, saying it was nothing like 2002.
He added that SBI would continue to collect from NBFCs the right portfolios that meet their underwriting criteria. SBI recently increased its NBFC asset purchase target from Rs 15,000 to Rs 45,000 crore, which the experts termed a bailout. However, Rajnish Kumar described this situation as a "win-win" for the SBI and NBFCs, as the former would benefit from a good business opportunity, while the latter would be able to offload some short papers. term.