Home » Business » Union Finance Minister Smt. Nirmala Sitharaman chairs meeting to review the preparedness of Public Sector Banks in wake of the stress in banking systems in the US and Europe

Union Finance Minister Smt. Nirmala Sitharaman chairs meeting to review the preparedness of Public Sector Banks in wake of the stress in banking systems in the US and Europe

Newdelhi:25/3/23:Union Minister for Finance and Corporate Affairs Smt. Nirmala Sitharaman chaired a meeting here today to review the performance of Public Sector Banks (PSBs) on various financial health parameters, and the resilience of PSBs in light of the current global financial scenario emanating from the failure of some international banks in the USA and Europe.

The meeting was also attended by Union Minister of State for Finance Dr Bhagwat Kishanrao Karad; Dr. Vivek Joshi, Secretary, Department of Financial Services (DFS); and MDs & CEOs of Public Sector Banks.

During the review meeting, an open discussion was held with the MDs and CEOs of PSBs on the global scenario comprising of the failure of the Silicon Valley Bank (SVB) and the Signature Bank (SB) along with issues leading to the crisis in Credit Suisse. Smt. Sitharaman reviewed the exposure of PSBs to this developing and immediate external global financial stress from both the short and the long-term perspectives.

During the PSB review meeting, the Finance Minister emphasized on preparedness along with due diligence through adherence to the regulatory framework by focusing on risk management, diversification of deposits and assets base.

The Finance Minister underlined that PSBs must look at business models closely to identify stress points, including concentration risks and adverse exposures. Smt. Sitharaman also exhorted PSBs to use this opportunity to frame detailed crisis management and communication strategies.


The MD & CEOs of the PSBs apprised the Finance Minister that they follow best corporate governance practices, adhere to regulatory norms, ensure prudent liquidity management and continue to focus on having robust asset-liability and risk management. Further, Smt. Sitharaman was also informed by the PSBs that they are vigilant of developments in the global banking sector and are taking all possible steps to safeguard themselves from any potential financial shock.  All the major financial parameters indicate stable and resilient PSBs with robust financial health.

After detailed deliberations, the Finance Minister advised PSBs to remain vigilant about the interest rate risks and regularly undertake stress tests. Smt. Sitharaman also highlighted that PSBs must leverage the full potential of branches opened in International Financial Services Centres in GIFT City Gujarat to identify international opportunities, including prospects related to Persons of Indian Origin (PIOs).

Also, during the course of discussion on the general banking scenario prevailing in the country, Finance Minister advised PSBs to:

  1. Take focused steps to attract the deposits given the steps taken by the Government to reduce the tax arbitrage in some debt instruments;
  2. Pivot their strengthened financial position to support credit needs of the growing economy;
  3. Focus on credit outreach in States where the credit offtake is lower than the national average, particularly in North-East and Eastern parts of the country;
  4. Enhance business presence in new & emerging areas like One District One Product (ODOP), e-NAM, and drones;
  5. Aim to increase brick & mortar banking presence in border and coastal areas;
  6. PSBs should promote the Mahila Samman Bachat Patra announced in the Budget 2023-24 through special drives and campaigns.

About Editor in chief

Ashok Palit has completed his graduation from Upendranath College Soro, Balasore and post graduation from Utkal University in Odia Language and literture.. He has also carved out a niche for himself as a scribe of eminence after joining the profession in 1988. He is also an independent media production professional. He brings loads of experience to Advanced Media, Ashok Palit as a cineaste has been active in film criticism for over three decades. As a film society activist, he soared to eminence for his profound commitment to the art film appreciation and aesthetics of cinema. His mode of discourse is often erudite but always lucid and comprehensible marked by a perfect acumen so rare in the field. A film aesthete with an immense fond of critical sensibilities, he wrote about growth and development of odia cinema in New Indian Express, The Times of India, The Hindustan Times, The Asian Age and Screen. He has been working as an Editor for Cine Samaya from 2002-2004.. He had made solid contribution on cinema in many odia Dailies and weekly such as Samaj, Prajatantra, Dharatri, Samaya, Satabadi, and weekly Samaya.

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