A cross-section of bankers and insurance professionals interviewed by Business Standard said the new government should stick to its earlier proposal of bringing down government stake to 33 per cent in public banks from the present 51 per cent.
They also felt that the cap on voting rights should be lifted and foreign holding in insurance companies should be increased from the current 26 per cent. Voting rights in public banks are now capped at 10 per cent irrespective of the stake holding of a shareholder.
Allianz country manager & CEO Allianz Bajaj Life Insurance Sam Ghosh said being one of the architects of the reforms agenda in his earlier avatar as finance minister, Manmohan Singh is expected to carry on with the divestment in the financial sector.
"We hope the cap on voting rights is increased from the current 10 per cent and aligned to the shareholding pattern in a bank," Christopher M Low, CEO, Standard Chartered Bank, said.
IndusInd Bank managing director Bhaskar Ghose said the cap on voting rights brings about inconsistency with regards to mergers and acquisitions in the banking sector.
IDBI Bank managing director Nageshwar Rao said if the new government is successful in sustaining high economic and industrial growth, the health of banks sector would remain good.
"The government will have to evolve a policy framework, providing a roadmap for managerial autonomy in public sector banks, especially with regard to human resources issues so that public sector banks can compete effectively in light of liberalisation in foreign director investment," he added.
Birla Sun Life Insurance CEO Nani Javeri said: "In life insurance we would like to see increasing FDI."
Allianz's Ghosh also expects further liberalisation of foreign investment in insurance.
The consensus in the financial sector is voiced by ABN Amro Bank chief executive Romesh Sobti when he said: "We want continuity in the trajectory of the reform process, which has taken place over the last decade in the sector."
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