P Chidambaram says election code of conduct not to impact new bank licences process

Asked about consolidation in the banking sector, Chidambaram said: "I am advocate of consolidation but I have said that the initiative must come from the banks themselves, which means banks have to take their stakeholders into confidence. It has to come from banks."

On capital infusion in PSU banks, the finance minister said the government will provide more funds if it mobilises higher resources.

"As you know, government has provided Rs 11,200 crore for next year. This is not adequate, but that's the budget estimate... As we find more money, we should infuse more into the public sector banks," he said.

Chidambaram said the meeting also deliberated on ways to raise equity capital of public sector banks to support their growth.

"We have discussed ways to raise additional Tier I capital. Hopefully, we can take them forward. I will discuss some ideas when I meet with RBI board day after tomorrow," he said.

Chidambaram will address RBI board on March 7.