Business Ethics and Corporate Governance, Second Edition

CONSTRAINTS TO ETHICAL PRACTICES IN INDIAN NATIONALIZED BANKS

Indian banking has seen phenomenal changes during the 20th century. Starting with the banking being concentrated in the hands of a few selected groups of business communities like the chettiars in the south, marwaris in the east, the Gujaratis in the west, the banking industry has moved from the limited area of operations to global operations through the process of social control, nationalization of banks and greater autonomy to the banks.

Over the last three decades, we have traversed quite some distance from micro-management of banks by capping call money rates, stipulating interest rates across the board and public humiliation of banks’ personnel who resisted direct lending in respect ...