With reference to the governance of public sector banking in India, consider the following statements:1. Capital infusion into public sector banks by the Government of India has steadily increased in the last decade.2. To put the public sector banks in order, the merger of associate banks with the parent State Bank of India has been affected.Which of the statements given above is/are correct?
✓ Correct answer: b) 2 only
ExplanationStatement 1 is incorrect : Capital infusion into Pub- lic Sector Banks (PSBs) over the last decade has not followed a steady upward trend.It has been cyclical driven primarily by spe- cific challenges such as rising non-performing assets (NPAs).The government has made substantial infusions during critical peri- ods while scaling back during others, depending on the banks’ requirements and fiscal constraints.Statement 2 is correct: In 2017 five associate banks (State Bank of Bikaner & Jaipur, State Bank of Hyderabad, State Bank of Mysore, State Bank of Patiala, and State Bank of Tra- vancore) along with Bharatiya Mahila Bank were merged with State Bank of India (SBI).This merger was aimed at im- proving operational efficiency, reducing costs, and enhancing the balance sheet of SBI.171
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