India aims to form global-sized banks
(27 November 2012 – India) The Indian government is aiming to create mammoth banks that can compete globally.
India’s Finance Minister P Chidambaram, said the country needs one or two global-sized banks as it advances to become the world's third largest economy.
'Finding new business models will inevitably lead to some consolidation," he said. "We must create at least two or three world size banks. China has done it."
Unions in the country are fearful that consolidation will cause job losses in the merged financial institutions.
"I know there is pride and identity, but ultimately some consolidation would have to take place in the banking system in this country,' Chidambaram said.
There are 19 nationalised banks and scores of private and foreign banks in India. There is also the State Bank of India and its five associate banks that are in the process of merging.
The Finance Ministry recently asked large public sector banks to assist their smaller counterparts to improve the latter's operations.
'Finding new business models will inevitably lead to some consolidation," he said. "We must create at least two or three world size banks. China has done it."
Unions in the country are fearful that consolidation will cause job losses in the merged financial institutions.
"I know there is pride and identity, but ultimately some consolidation would have to take place in the banking system in this country,' Chidambaram said.
There are 19 nationalised banks and scores of private and foreign banks in India. There is also the State Bank of India and its five associate banks that are in the process of merging.
The Finance Ministry recently asked large public sector banks to assist their smaller counterparts to improve the latter's operations.
Subscribe