Bank stocks in focus as Lok Sabha passes Banking Laws (Amendment) Bill, 2024
Bank stocks are in the spotlight on Wednesday, December 4, after the Lok Sabha passed the Banking Laws (Amendment) Bill, 2024 on Tuesday during Parliament's winter session, introducing significant changes to banking regulations.
«Banks are being professionally run today. The metrics are healthy so they can go to the market and raise bonds, raise loans & run their business accordingly,» said Finance Minister Nirmala Sitharaman in her address at the Lower House of the Parliament.
Among its key provisions, the Bill allows depositors to nominate up to four individuals for their bank accounts or fixed deposits, replacing the current single-nominee system. The move aims to simplify fund distribution after the death of an account holder, a problem that arose during the COVID-19 pandemic.
The Bill permits depositors to opt for either simultaneous nomination, where nominees are assigned specific percentage shares, or successive nomination, where nominees inherit in a predefined order. This change is expected to make fund access smoother for families while also reducing procedural delays.
Other significant reforms in the Bill include redefining «substantial interest» for bank directorships by raising the threshold from Rs 5 lakh to Rs 2 crore, a figure unchanged for nearly six decades. It also grants banks greater freedom in deciding the remuneration for statutory auditors and modifies regulatory reporting deadlines to the 15th and last day of every month, replacing the existing second and fourth Fridays.
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