ATMs run dry as bank stir continues

07 Aug 2009

1

India's public sector banks remained shut today as a nationwide strike by their employees demanding higher wages and pensions entered the second day, hurting volumes in the bulk cash, currency and bond markets.

Although private banks continued to operate as usual – at least in Mumbai and some other major metros – a majority of trade and industry was hit by the strike by staff of 25 nationalised banks. State-run banks account for more than half of banking sector assets and have a dominant presence in the fixed income and foreign exchange markets.

Around 900,000 employees announced the two-day strike after talks with Indian Banks Association, representing the managements of various banks, collapsed earlier this week.
The strike is expected to end today, although the IBA is yet to formally respond to the demands of the striking employees.

"The bank strike is expected to be called off today. I am being told that talks are on between the bank associations and worker unions," finance minister Pranab Mukherjee said while replying to supplementaries during Question Hour in the Lok Sabha.

Prakash Gangal, secretary of All India State Bank of India Staff Federation, said the strike was ''100 per cent on today as well''. He added that the labour commission has convened a meeting with bank unions at 3 pm today to resolve the issue. The SBI union is part of the United Forum of Bank Union, the umbrella organisation spearheading the strike.

India has 80 commercial banks, including 29 foreign banks and nearly 3,000 urban and rural co-operative banks. The volume recorded in the bond market was low at Rs25 crore. Trading on Thursday was Rs2,915 crore, compared to Rs4,350 crore on Wednesday.

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