Don't have any view on fiscal health of any bank: Odisha government issues clarification after RBI expresses concern

Reserve Bank of India had reportedly expressed concern over Odisha government cautioning its departments against placing deposits with banks.

Bhubaneswar: After Reserve Bank of India (RBI) reportedly expressed concern over Odisha government cautioning its departments against placing deposits with banks, the Naveen Patnaik-led administration on Friday came out with a clarification saying that it does not have any view on the fiscal health of any particular bank.

"It is to be clarified that the state government does not have any view on the fiscal health of any particular bank. That comes under the domain of Reserve Bank of India. There is no reason for anyone to get apprehensive about the financial health of the banks in general," read the clarification from Odisha's Principal Secretary to all the concerned officials and departments.

Further, the clarification states that the earlier circular issued on October 21 was only meant to avoid opening of new accounts and shifting of government funds meant for welfare and development activities of government without any reason from one bank to another.

However, it said that the withdrawal of government fund from the state treasury and parking the same in banks for a long period without an adequate justification causes loss to the state exchequer and should be avoided.