FM to review performance of PSU banks next month

Finance Minister Pranab Mukherjee will review the performance of all public sector banks next month after the release of financial numbers by the lenders for 2010-11 financial year.

"We will have a review next month with the Finance Minister ... May be towards the end of May," Department of Financial Services (DFS) Secretary Sashi Kant Sharma said after a meeting with the heads of public sector banks and financial institutions.

Among other things, the meeting discussed the financial performance of state-run banks for nine months to December 2010.

"We discussed performance parameters which have been set for the public sector banks. Apart from that we discussed the progress under the programme of financial inclusion," Sharma said.

Sharma also said the banks are planning for the second phase of the financial inclusion programme, in which all the unbanked villages of the country will be covered.

Under the first phase of financial inclusion programme, about 73,000 villages are to be brought under the banking system.

Besides, the bankers also discussed the linking up of the financial inclusion programme with Aadhaar (UID), under which biometric identification cards will be issued all Indians.

Sharma further said the bankers also discussed the proposed programme of direct transfer of subsidies.

Concerned over the misuse of subsidies provided under various schemes, Mukherjee in his Budget speech had announced that the government will provide a direct cash subsidy on kerosene and fertilisers to the poor from March next year.

The Secretary, however, said issues like high inflation and forthcoming monetary policy of the RBI did not come up for discussions during the meeting.

At the same time, the meeting also deliberated on non-performing assets in the banking sector and issues related to education loan.