The Scourge of PSBs

HDFC Bank pipped State Bank of India (SBI) to become the most valued bank by Market Capitalization.

As the son of a serving SBI officer and having been in service of one of SBI's many subsidiaries, SBT (State Bank of Travancore) as a Probationary Officer, this was a rather embarrassing and sad news, though I understand that this news will be history sooner than later. But what strikes me is the apathy with which my fellow citizens view SBI and the other PSBs (Public Sector Banks) in India. Evident when a friend of mine, an account holder and shareholder of HDFC Bank, pointed me to the above news item with a sarcastic smiley over IM.

Agreed, the service rendered by most PSB branches are no where near comparable to those offered by the private and foreign banks (PFBs) in India but is that reason enough to hate the PSBs with such hatred. The media too have field days in pointing out mistakes by PSBs while going soft on the PFBs, probably because a lot more can be exposed because PSBs are covered by the Right To Information (RTI) act while PFBs aren't?! So much for being transparent.

It is a well known fact how private banks use 'goondas' and other not so dignified means to recover money, as a borrower the people complain of this callous act but as an investor they are annoyed when PSBs declare rising NPAs (Non Performing Assets). The private banks hardly lend to farmers for they hardly have branches in remote places, so when the monsoon fails it is the PSBs that write off the farmer's loans and take a hit on their profits. The urban educated, savvy, young population would brush off a PSB as not quick enough for their lifestyle but most would have availed an Education loan from a PSB as private banks shun them. The private banks intimidate poor pensioners but whine about lack of Government businesses.

The private and foreign banks brought in many firsts in India and set new benchmarks in service, but the public sector banks have always stood for the nation and should be respected for what they have done.