"We inherited a very major problem and therefore, we have been involved in finding a solution to that problem", he said, adding that the government wants to create an institutional mechanism to sure the past is not repeated. This would increase public accountability of PSBs as independent agencies to evaluate and rank PSBs annually on reforms.He said the government will not interfere in commercial decisions taken by banks so that they are independent but they have to undertake reforms and do "prudent and clean" lending.Strengthening, empowerment and professionalisation of bank boards is high on the agenda of the government.Kumar said one independent director on the board of each bank will have to review the progress of reforms every quarter. "The emphasis is to improve governance on the boards of banks".Economic Affairs Secretary Shubhas Chandra Garg said the bonds would not be tradeable in market and have maturity period of 10-15 year. The pricing would be based on 3 month average plus a spread. "These would not be SLR bonds and would be swap deal," he said.Garg said the bonds would not impact the fiscal deficit calculation of the government as it would be cash neutral arrangement.Asked if the there is a proposal to raise FDI in banking sector, he said there is no such proposal "at present".

Source: Economic Times January 24, 2018 10:46 UTC