Public Sector Banks (PSBs) to go on strike on Dec 16, 17 against privatisation

Public Sector Banks (PSBs) will go on strike on December 16 and 17 protesting against the Union government’s move to privatise PSBs. The United Forum of Bank Unions (UFBU), an umbrella organisation of nine employee unions and associations in the banking industry, has given the call for the two-day strike. UFBU is opposed to the tabling of the Banking Laws (Amendment) Bill, 2021, during the current winter session of Parliament since the Bill will enable the Centre to privatise banks.

“Attempts to privatise public sector banks are unwarranted and counter-productive. Privatisation will result in the PSBs and their vast resources being handed over to private hands. PSBs play a major role in the development of agriculture, small trade, small business, small scale industries, and transport,” he said.

Countering the argument that PSBS need to be privatised to improve efficiency, he said that PSBs are doing well and earning substantial profit. The profit during the 2009-10 was Rs 76,945 crore and it has touched Rs 1.74 lakh crore in 2019-20 and Rs 1.97 crore in 2020-21.

Though initiatives like the debt recovery tribunal, Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, Insolvency and Bankruptcy Code and others have been initiated by the Government, they not yielded the desired results and banks were



forced to write-off huge loans. In cases where some recoveries happened from big corporations, they has been with haircuts (bank accepting less than what was due from a particular loan account) ranging from 23 per cent to up to 95 per cent. Citing resolution figures of 13 big loan accounts, he said the total due from these accounts was about Rs 4.46 lakh crore while the resolutions and settlement was for Rs 1.61 lakh crore, resulting in a loss of  Rs 2.84 lakh crore for the banks. This was a haircut of 64 per cent, he said.

PSBs have been used to bail out private sector banks like the Global Trust Bank, United Western Bank, Bank of Karad and YES Bank. Private sector’s largest NBFC, IL&FS, was bailed out again by public sector players SBI and LIC, he said.

PSBs also have a major share in implementation of schemes like Jan Dhan, MUDRA for unemployed youth, Swadhan for street vendors, Pradhan Mantri Awas Yojana, Pradhan Mantri Jivan Jyoti Yojana, Pradhan Mantri Jivan Suraksha Yojana, Pradhan Mantri Garib Kalyan Yojana, Pradhan Mantri Kisan Kalyan Yojana, and Atal Pension Yojana for the underprivileged sections of the society, the official said. 

The bank employees and officers will oppose the tabling of the Banking Laws (Amendment) Bill in the Parliament, including resorting to indefinite strike against privatisation of banks, he said.