IBA to interact with Assocham, Ficci to refocus on role
OUR BANKING BUREAU
MUMBAI, January 22: The Indian Banks' Association (IBA) will interact with industry chambers like the Confederation of Indian Industry (CII), Associated Chambers of Commerce & Industry (Assocham) and Federation of Indian Chambers of Commerce & Industry (Ficci) in a bid to refocus its role.Talking at the first international retail-financial services conference for India and South Asia in Mumbai on Thursday, IBA chairman AT Paneerselvam said the association had so far kept away from interacting with the industry. The conference was arranged by the Lafferty's group. "We have remained insulated from the industry. Now we want to interact with the industry chambers on a one-to-one basis to know what they want. We have appointed Arthur Anderson to revamp the IBA as times have changed. A sea-change in IBA's image has become necessary," Paneerselvam said. The IBA chairman, who is also the Union Bank of India (UBI) chief, said the bankers' body would tie up with similar associations in the United States, United
Kingdom and Japan. "Although they are far ahead of us, we can share a lot of things and learn from their experiences," Paneerselvam added. IBA's role and importance suffered after interest rates were deregulated by the Reserve Bank of India (RBI). "People those days said that we had formed a cartel. That was a regulated regime. Things have changed and we have to change ourselves. We have to look beyond the role of a wage negotiator in the banking industry," the IBA chairman said. According to Paneerselvam, a shakeout will occur in the banking industry over the next five years and 50 per cent of about 900,000 employees may end up losing their jobs. "A shakeout will be there. In fact, there will be a lot to learn from foreign banks and there might be alliances between the foreign and the public-sector banks in the future," the UBI chairman cum managing director said. He also feels there will be a revolution in retail banking as delivery systems get updated and more sophisticated products are
introduced."Technology will be introduced both on asset side as well as the liabilities side of the balance sheet," Paneerselvam said. The banks' branch network can be used to create financial supermarkets, he added. Paneerselvam also said public-sector banks will again focus on retailing. "We have gone through the whole cycle where we entered into merchant banking, corporate banking, wholesale banking, mutual funds and had ignored retail banking. Now we are back to retail banking," he said. Earlier, delivering the keynote address,the Industrial Development Bank of India advisor and former UTI chairman SA Dave said the RBI should withdraw the locking period for money- market mutual funds (MMMFs) and also allow them cheque-book facilities. "This will help MMMFs in becoming more attractive as a saving instrument," he said.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
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