Stay out; your grip is killing PSBs: Outgoing BoB chief tells Modi govt

He recommends the government start by allowing banks' boards to hire their own management and free them up to decide strategy

The head of one of India’s largest state-run banks says the government needs to ease its grip over the lenders or risk slowly killing off the sector.

Tight government control makes it hard to attract talent or take the tough decisions needed to address the bad debts weighing down the banks, according to Ravi Venkatesan, the outgoing chairman of Bank of Baroda. Government-controlled lenders need to consolidate if they are to avoid losing yet more market share to private-sector peers, but this is better achieved after the banks get stronger rather than merging weak banks, he said.

“India needs fewer,