Public Sector Banks (PSBs) Current Affairs - 2020

RBI sets up P K Mohanty Panel to Review Ownership of Private Banks

On June 12, 2020, the Reserve Bank of India has constituted an internal working group. The working group is to review guidelines of ownership of private sector banks.


The panel constituted by the apex bank is to examine regulations to hold financial subsidiaries through non-operative financial holding company. The group is to be headed by the Executive Director of RBI, P K Mohanty.


The Group is to examine the existing regulation and guidelines on ownership of private sector banks. Also, the panel will suggest appropriate norms to address the issue of concentration of control and ownership of banks. The group will also review the eligibility criteria of the individuals to apply for banking license.

The Group will also study the current regulations to hold financial subsidiaries through NOFHC (Non-Operative Financial Holding Company). It will also make recommendations to migrate all the banks towards a uniform regulation.


The NOHFC was formed in 2015 to separate financial activities carried out by the same company. This will help the company carry out other commercial and industrial activities.

The entities in public sector and private sector and in Non-Banking Financial Companies (NBFCs) shall set up bank that will be owned by NOFHC. The company formed is to be registered as NBFC.

Loans worth Rs 3,200 crores sanctioned under Atma Nirbhar Bharat Abhiyan

On June 2, 2020, the Public Sector Banks sanctioned collateral free loans that were worth Rs 200 crores. The complete Rs 200 crore sanction was done in a single day.


The PSBs are set to sanction Rs 3,200 crores under Atma Nirbhar Bharat Abhiyan. This will benefit MSMEs (Micro, Small and Medium Enterprises) that are located in more than 3,000 TIER-2 towns. These loans will help MSMEs meet their expenses towards rent, restocking of goods and payment of salaries.

Atma Nirbhar Bharat Abhiyan

The Union Finance Minister Nirmala Sitaraman while announcing the economic package of Rs 20 lakh crore under the Atma Nirbhar Bharat Abhiyan Scheme, said that collateral free loans with one-year moratorium will be provisioned. These loans are those that are now being provided by the Public Sector Banks. (Moratorium is the period during which the borrower is not obligates to make any payment).

Under the scheme, for the other stressed sectors up to 25 crores of rupees are availed as additional 20% of outstanding loans.