Government to lower number of public sector banks to 10-15: FinMin advisor

NEW DELHI: India will have 10-15 public sector banks with government's majority stake, down from 21 at present, as part of its plan to consolidate banks, Finance Ministry's principal economic advisor Sanjeev Sanyal said on Friday.
He said cleaning up of the bad loan problems is the first priority and after that the PSU banks could be consolidated.
"There are something like 21-22 public sector banks.. The numbers will be reduced in terms of consolidation, but somewhere to the 10-15 range. We are not going to take it too far down...We need to consolidate some of these large number of banks, but be clear that we are not going to reduce these down to some people think like 4-5 national champions.
We recognise that that will lead to too many 'too-big- to-fail' banks. Currently, we have one large bank State Bank of India... We do not want to create a large number of them. Then we will have a real problem in terms of concentration of risks," Sanyal said at the India Economic Summit.