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Stiffer Challenges Await the New Banks Board Bureau

Though it will benefit from the preparatory work done by its predecessor, the new Banks Board Bureau has a tough task ahead of it. The operational state of public sector banks has deteriorated, asset quality woes have increased, and employee morale is sagging. While many of these issues are beyond its mandate, it may need to account for and address them in order to meet its core objective of fixing the governance of public sector banks.

After the two-year term of the Banks Board Bureau (BBB) ended on 31 March 2018, the government reconstituted it with a new team. The new BBB has the potential to resurrect public sector banks (PSBs) and maintain continuity in its policy stances. It reinforces the government’s commitment to reform PSBs, particularly at a juncture when many of them are reeling under unprecedented operational stress. Given the challenging mandate, it has to reinvent its strategic role through greater coordination with all stakeholders, especially the Department of Financial Services (DFS). The revamped BBB assumes the responsibility of continuing to stay dominant in the banking space, with PSBs needing rejuvenation and moral support.

Genesis and Mandate

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Updated On : 17th Aug, 2018

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