'Economy shifting to different plane', India needs big banks: Sitharaman

The National Asset Reconstruction Company, cleared by the cabinet 10 days ago, should not a be called "bad bank", Finance Minister tells banks association.

India will need more large lenders like the State Bank of India as the "economy shifts to a different plane altogether", said Finance Minister Nirmala Sitharaman on Sunday, keeping with her government’s message that vaccinations for Covid-19 are leading to national recovery.

"We need to scale up banking to meet changing requirements in light of the shifting recent realities of the economy and industry,” she told the Indian Banks' Association (IBA) in Mumbai.

“The way in which the economy is shifting to a different plane altogether and the way industry is adapting, many new challenges have risen. It came to fore that India needs not only more, but bigger banks,” she said.

"India needs four or five more banks like the State Bank of India (SBI). We need to scale up banking to meet changing requirements in light of the shifting recent realities of the economy and industry."

The National Asset Reconstruction Company, cleared by the cabinet 10 days ago, is not a "bad bank", she said.