Finance Minister Mr. Pranab Mukherjee has said that financial stability has become an integral part of policy planning across the world, in the post-crisis period.  Speaking at the inauguration of the 6th International 6th International Conference on Banking & Finance, organized by the Indian Merchants’ Chamber and the Institute of Chartered Accountants of India, in Mumbai today, Mr. Mukherjee said the greatest challenge now is to evolve circumstances to maintain the growth momentum. “A sound and resilient banking sector, well-functioning financial markets, robust liquidity management and payment and settlement infrastructure are the pre-requisites for financial stability” he added.

The Finance Minister said several measures have been suggested to enhance  the resilience of the global financial system to support the development path. These include enhancing transparency, strengthening risk management frameworks, refining regulatory mechanism, among others.

Mr. Mukherjee informed that gathering of bankers, investment consultants and corporate that the The Financial Stability Report for December, 2011 brought out by the Reserve Bank of India shows that the domestic financial system remains robust.  He said the Government is committed to ensure the requisite level of capitalization of Public Sector Banks (PSBs). The Finance Minister, however, cautioned that if GDP growth slows down, there could be some downstream impact on asset quality of banks.

The Government has infused more than Rs. 20,000 crore in 2010-11 and Rs 12,000 crore in 2011-12 in various PSBs in order to maintain a minimum Tier-I CRAR at 8 per cent and also to increase the Government of India holding in PSBs.


PIBMUM/MD/CKS