Mumbai, Nov 26 (UNI) Asserting that inorganic growth is one of the best ways to compete with large sized global banks, Minister of State for Finance Pawan Kumar Bansal today said that the Government and Reserve Bank of India will facilitate public sector and scheduled banks in capital raising to compete with global banks after the banking sector is opened by 2009.
While delivering the keynote address at the Annual Banker's Conference on ''Indian Banking: Towards Global Best Practices'' here, Mr Bansal said that it is an endeavour of both the Government and the RBI to provide regulatory climate in terms of managerial autonomy and operational flexibility to the banking sector to meet the challenges arising due to increasing competition.
''Our banks have to rise to the challenge of increasing globlisation and internationalisation of banking services and have to face it head on,'' he added.
Mr Bansal said that the foreign exchange reserve is far in excess of the external debt which has increased more than three folds from USD 76 billion at the end of March 2003 to USD 270.18 billion at the end of October 2007.
Currently, all scheduled commercial banks have capital adequacy ratio of 12.3 per cent which is much above the international norms of 9 per cent.
Citing an instance of PricewaterhouseCoppers report, he said, ''India may well be the third largest banking hub in the world by 2040.'' When quizzed about the functional autonomy of the public sector banks, Mr Bansal said, ''The Government is all for providing full autonomy to the banks and in near future it will become a reality.'' UNI