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We could be on the cusp of banking 2.0

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On the chessboard: 2021 will see tectonic shifts in the banking industry

India Inc could make a re-entry into commercial banking - 40 years after the last round of bank nationalisation in 1980

Indian banking system | Indian Banks | India Inc

Raghu Mohan  |  Mumbai 

Capital concerns Recapitalisation of state-run banks may have outlived its purpose. It’s stuck on two counts — very little fiscal headroom, and the low valuations of these banks. While privatisation remains an option, the current low valuations make it unattractive.

Between 2015-16 and 2019-20, the Centre pumped in Rs 3.56 trillion into these banks through direct subscription to equity shares and recapitalisation bonds. Their market capitalisation is a tad above Rs 4 trillion. The Centre may have to go in for the bank holding company model. This will also entail governance ...

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First Published: Mon, January 04 2021. 06:10 IST