Gyan Sangam 2.0


Ajit Kumar AJIT KUMARWISDOM IAS, New Delhi.

The second conclave of Gyan Sangam (Gyan Sangam 2.0) names “Retreat for Banks and Financial Institutions” held at Gurgaon on 4th and 5th March 2016. First meet was held in  Pune in 2015.

The two-day Gyan Sangam summit is a forum where the highest officials from public sector banks, the government and the Reserve Bank of India, meet to discuss issues facing the sector.

Several issues were considered at the Gyan Sangam 2.0.Finance Minister Arun Jaitley. said "Among these were discussions on bank consolidation, non-performing assets, carrying out changes to recovery laws and giving out employee stock options." The FM, however, said that the government would consider all suggestions that banks had made and added that while no decision on any proposals has been taken, the government was actively looking into forming a bank consolidation committee and tweak laws such as the SARFAESI and with respect to the debt recovery tribunal. The debt recovery tribunal will likely be streamlined to shift its processes online and an effort will be taken to compress the period taken to decide on a case in DRT.

A lot of discussion took place between the bankers that focused on using digital technologies to change the revolutionize the way banking is done in the country. Concerns on governance, NPA, weak recovery frameworks, political interference, and progress of financial inclusion were also expressed.

State Bank of India Chairperson Arundhati Bhattacharya reportedly said, "We as a group (all public sector banks) have decided to adopt five major resolutions." The five points include -- a decision to re-orient the portfolios of small public sector banks to focus on specific and differentiated niches, build people capacities, use of more technology (especially in the top 30 processes), strengthen risk management practises and strengthen the partner channels such as business correspondents.

Criticism –

- Ended without any policy announcement.
- Consolidation may not be a great move as a large bank acquiring a small bank will make the former weaker.

Actions Taken After Gyan Sangam 1.0

Adopting the recommendations of the PJ Nayak committee, the government has split the post of chairman and managing director. It also appointed two managing directors and two non-executive chairmen from the private sector, indicating that it is open to attracting talent from outside. It has also put in place a bank board bureau which will replace the current selection committee that appoints top bankers. The bureau will be headed by former Comptroller Auditor General of India Vinod Rai and will have three other members.


Monday, 23rd May 2016, 11:11:47 PM

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