India wants bigger banks to match global giants—But size alone doesn't assure better outcomes

Small is beautiful, said German-born British economist, E.F. Schumacher, in the early 1970s. But not in the world of banking. Or so it would seem, going by comments of home minister Amit Shah and, lately, finance minister Nirmala Sitharaman on increasing the size, including possibly through consolidation, of public sector banks (PSBs). The desire to see more Indian banks enter the ranks of top global banks is understandable. Much like the desire to see India move up the rankings in the league of the world’s ...