Bank privatisation as an experiment

The government must test the efficacy of privatising two banks first before going the whole hog

Say this for the proposed move to privatise two public sector banks (PSBs) in the coming financial year: It’s preferable to the course proposed by the P J Nayak Committee on bank governance (2014). 

The committee had proposed a bank holding company, run by professionals, to which shares of PSBs would be transferred. The proposal was always a non-starter. Handing over 60 per cent of the banking system to a group of “independent” professionals, however eminent, is unthinkable. If the government wishes to give autonomy to PSBs, it can do so today. And if it doesn’t, creating a bank holding company