L to R- Vivek Joshi, secretary, Department of Financial Services, Nirmala Sitharaman, Union Minister for Finance and Corporate Affairs and M. Nagaraju, secretary-designate, DFS. at at a meeting in New Delhi to review the performance of public sector Banks (PSBs)
The Finance Minister also urged that every aspect of the IT system should be reviewed periodically and thoroughly from the cyber security angle to ensure that the security of the bank systems is not breached or compromised
New Delhi: Nirmala Sitharaman, Union Minister for Finance and Corporate Affairs, chaired a meeting on Monday, in New Delhi, to review the performance of public sector Banks (PSBs) on their financial parameters, deposit mobilisation, digital payments and cyber security framework, in addition to access to credit under financial inclusion and other emerging issues related to PSBs.
The issues related to digital payments and cyber security framework were also deliberated in the meeting.
Sitharman advised that issues of cyber security should be seen from a systemic perspective and emphasised that a collaborative approach between banks, Government, regulators and security agencies is needed to put in place necessary mitigants against cyber-risks.
The Finance Minister also urged that every aspect of the IT system should be reviewed periodically and thoroughly from the cyber security angle to ensure that the security of the bank systems is not breached or compromised.
Sitharaman noted that the Government, through various schemes, has always endeavoured to facilitate credit access to citizens at the bottom of the pyramid to support their livelihood and improve lives.
She further asked the banks to expeditiously implement the recent Budget announcements, including, a new credit assessment model for MSMEs based on digital footprints and cash-flows. Banks were also instructed by the Union Finance Minister to focus on further increasing credit flow to eligible beneficiaries under various Union Government initiatives like PM Surya Ghar Muft Bijli Yojana and PM Vishwakarma Yojana.
During the meeting it was noted that during FY24, the PSBs performed well across all financial parameters as evidenced by improved asset quality with Net NPAs (NNPAs) declining to 0.76%, sound capital adequacy of the banks at 15.55%, Net interest margin (NIM) of the banks at 3.22%, and highest ever net aggregate profit of Rs. 1.45 lakh crore with the dividend of Rs 27,830 crore to the shareholders.
Improvements over various parameters have also enhanced the ability of PSBs to raise capital from the markets.
During deliberations on the deposit mobilisation, the FM stated that while the credit growth has picked up, mobilisation of deposits could further be improved to fund the credit growth sustainably and asked banks to make concerted efforts to garner deposits by conducting special drives.
Sitharaman also advised PSBs to have better relationships with their customers for efficient customer service delivery. The Union Finance Minister also urged Banks to ensure that employees reach out to connect with their customers, especially in Rural and Semi-urban areas.
She also urged the PSBs to explore collaboration to leverage the respective strengths by sharing best practices in emerging areas and equip themselves to keep pace with changes in banking sector.
The Union Finance Minister further advised the banks to ensure compliance with the Reserve Bank of India’s guidelines on the handover of security documents after closure of the loans and directed that there should not be any delay in handing over the documents to the customer.
The meeting was also attended by Vivek Joshi, secretary, M. Nagaraju, secretary-designate, Department of Financial Services(DFS), heads of Public Sector Banks (PSBs) besides senior officials of (DFS).