Previous Amendments to facilitate divestment
The latest amendments to the Banking Regulation Act in India include the Banking Laws (Amendment) Bill, which aims to privatize two public sector banks (PSBs) ¹. The bill proposes to lower the minimum government holding in PSBs from 51% to 26% ¹. The amendments will be made in the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 and 1980 and the Banking Regulation Act, 1949 ¹. The bill has been met with opposition from bank unions, who argue that it will lead to social injustice and denial of reservation to backward classes ¹.
Some of the key points of the bill include ¹:
– Lowering the minimum government holding in PSBs from 51% to 26%
– Amendments to the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 and 1980 and the Banking Regulation Act, 1949
– Privatization of two public sector banks (PSBs), with Indian Overseas Bank and Central Bank of India being proposed for privatization
– Opposition from bank unions, who argue that it will lead to social injustice and denial of reservation to backward classes
Latest Amendments
The latest amendment on banking is the Banking Laws (Amendment) Bill, 2024, which was introduced in the Lok Sabha on August 9, 2024 ¹. The key highlights of the bill are:
– Allowing up to four nominees per bank account
– Redefining ‘substantial interest’ for directorships, potentially raising the threshold from ₹5 lakh to ₹2 crore
– Giving banks more flexibility in determining the pay for statutory auditors
– Changing the regulatory reporting dates for banks to the 15th and last day of each month
Additionally, the bill aims to privatize two public sector banks (PSBs) by lowering the minimum government holding in PSBs from 51% to 26% ².
