Mumbai: The public sector banks are in for more challenging times following the stimulus package announced by the Union Finance Minister Nirmala Sitharaman, said a top leader of the major banking union All India Bank Employees’ Association (AIBEA).
Bulk of the Finance Minister’s measures are related to giving more loans to various sectors. So, there will be pressure on the banks to distribute loans. There will be further increase in non-performing assets of public sector banks, C.Venkatachalam, General Secretary, AIBEA said.
According to him, borrowers whose loan accounts have turned NPA should be be given further loans. Government had earlier talked about Insolvency and Bankruptcy Code (IBC) to recover bad loans. Now IBC is put on hold. So, recovery will not be there, Venkatachalam said.
He also added that Sitharaman has announced privatisation of public sector enterprises that are not in the strategic sectors.