New Delhi [India], Jan 6 (ANI): Union Finance Minister Arun Jaitley on Saturday stated that amid the rising challenges emerging before banks in the present day, the resilience of the banking system is undergoing a test.
"The financial system of the country is what spurs the growth of the economy, ultimately. However, in the recent past, challenges have appeared before the banking system, and it is the resilience of the system that is undergoing a test today. It is the responsibility of the banking system to restore its credibility and help spur growth of the economy. Taxpayers are making a sacrifice to keep you in good health," Jaitley said, while speaking at the Platinum Jubilee Celebrations of UCO Bank, here.
Jaitley, however, noted that amidst the global slowdown, India's economy continued to grow at a significant pace.
"During the global slowdown, commodity prices dropped, infrastructure saw a decline, and all this affected the balance sheets of companies, which in turn, affected the balance sheets of the bank. However, India continued to be one of the fastest growing economies, despite the temporary challenge posed by structural changes that were implemented," he said.
Talking about the bank recapitalisation plan announced for reviving public sector banks (PSBs), Jaitley said it was crucial to introduce this in order to keep the credit growth sustained, adding the infusion of the designated Rs. 2.11 lakh crore would further keep the credit growth positive.
"Banks must be conscious that to keep them in good health is important. They should be well aware of their responsibility for driving economy's growth. The Parliament, on its end, should also extend support," he said.
For the unversed, Jaitley had announced an unprecedented PSB recapitalisation program of Rs 2.11 lakh crore in October 2017, in a bid to improve the lending capacity of banks.
Following this, the ministry last week presented a demand in the Lok Sabha for an additional expenditure towards the bank recapitalisation plan to the tune of Rs 80,000 crore.
The supplementary grant was being sought to meet expenditure towards recapitalisation of PSBs, through the issue of government securities. (ANI)