Our Bureau

Mumbai , June 4

A DAY after he ruled out dilution of Government stake below 51 per cent in public sector banks, the Union Finance Minister, Mr P. Chidambaram, said that banks must explore innovative ways of finding new capital.

Speaking at the bicentennial celebrations of State Bank of India here on Saturday, he said that banks would need to incorporate new ideas and practices to infuse fresh capital, which is needed to meet international banking standards and regulatory compliance.

Asking banks to re-examine the concept of banking, he said, "Every Indian bank should become a multi-product financial centre and every bank employee a multi-tasking financial worker."

Speaking about SBI, Mr Chidambaram said that the bank must penetrate into rural India and also expand to the rest of the world, as it has the capacity, strength and human resources.

``I want to see the SBI logo in every capital of the world," he said, adding that it would require fresh funds. This (raising fresh capital) would be possible only if current policies and restrictions are reviewed, he said.

Mr Chidambaram said banks must expand credit substantially to fuel the targeted economic growth of eight per cent. The country's external trade is likely to touch $200 billion. The Government is hopeful that the economy will grow at eight per cent or more this year and trade will require more finance. Trade precedes investment and will also pave the way for Indian companies to become multinationals. Therefore, banks must acquire size and scale to support trade, he added.

Earlier, Mr Chidambaram had a meeting with industrialists, including Mr Rahul Bajaj, Mr Mukesh Ambani, Mr Ajay Piramal, Mr Adi Godrej and Mr Shashi Ruia, which was described as a "routine interaction."

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