Venkatachalam said the main challenge before the banks is the increasing bad loans (more than 5 trillion today) and the government is not doing anything towards that.

"Bulk of these bad loans are amounts due from private corporate houses, business enterprises and industrial houses. It is not wise to hand over the banks to the very same private sector responsible for the huge bad loans in the banks," he said.

Queried about the new National Democratic Alliance (NDA) government, he said, "We have seen its actions. The earlier NDA government had proposed to amend the Bank Nationalisation Act to bring down its stake in banks to 33 percent."

Looking back at the UPA rule and the protests held by the unions, Venkatachalam said: "We were able to thwart the speed of reforms planned by the outgoing government by our opposition. They could not do what they wanted to do."

He said around 200,000 bank employees will retire in two-three years' time and over a five-year period the total retirement will be around 400,000.

"That is a big challenge. The banks have to hire to fill in the vacancies. Already the branch network is on the growth path," Venkatachalam said.

According to him, during the past five years around 400,000 bank employees retired and the new hiring were only around 300,000.