Govt should cut stake in banks to below 51%

The Indian Banks’ Association has made a representation to the government proposing consolidation of public sector banks as well as dilution of government holding to below 51%. “Even with a 33% or 26% holding, the government will be the single largest shareholder, thereby giving it total control,” said IBA chief executive HN Sinor. However, if that happens, the government will lose the right of appointment, which will rest with the Reserve Bank of India (RBI) thereafter.