ESOP for PSU bank staff likely: Jaitley

ESOP for PSU bank staff likely: Jaitley

Gurgaon, March 5

The government will soon set up an expert group to look into the consolidation of public sector banks as the country needs stronger rather than a large number of banks, Finance Minister Arun Jaitley said here on Saturday.

He also said the government was considering ESOPs for PSU bank officials besides strengthening the SARFAESI Act and Debt Recovery Tribunals to deal with the problems of stressed assets that are estimated around Rs 8 lakh crore.

Addressing a press conference at the conclusion of the second edition of Gyan Sangam, Jaitley said that consolidation in the banking sector was discussed at the meeting and bankers themselves had suggested that an expert group be set up soon to look into the issue.

"We will consider that suggestion," the minister said, adding that the country needed stronger banks rather than large number of lenders.

There could be niche banks and banks which could survive independently and sustain themselves well, he said, observing that Gyan Sangam strongly supported the idea of consolidation in the banking sector.

The other idea which was suggested at the meeting was to reward the public sector bank employees with employee stock ownership plan (ESOP), he said.

"The government is considering (the proposal of ESOP for bank employees). It is in a very advanced stage.... It has been a long standing demand, and is (under) active consideration," Jaitley said.

With regard to the rising non-performing assets or bad loans, Jaitley said that besides strengthening the institutional mechanism, the government had been taking sector specific decisions to deal with the problems in segments like power, highways, sugar and steel.

Giving details of the deliberations during the conclave, Jaitley said there are suggestions to amend the SARFESI ACT and also expedite the DRT process by some more amendments to law.

Source:The Tribune