averages is too simplistic. [ slide 4 : europe is a tale of three ] europe is tale of three stories : north, south and east. side 2 af 8 the enlargement of the european union towards the east has been an economic success. but it has not been without challenges. but the level of prosperity in the new member states has been converging towards that of the core. and it has supported the overall growth in europe. there is certainly an element of catching up behind this. and moving up the value chain will become increasingly important to keep momentum. the south is the main source of europe's dismal economic reputation. it has been a clear growth laggard over the past decade. countries in the south have been drifting away from germany's gdp per capita since the financial crisis. while much has been done to restore competiveness, many challenges have been left unaddressed. there is still a clear need to tackle structural imbalances, rigid labour markets and weak productivity dynamics. the north is home to the most prosperous and competitive economies in europe. their economic performance over the past ten years has kept abreast with the usa and other major advanced economies. while the nordic region is in good shape, it will have to remain on the toes to stay ahead in the future. when taking stock of these three stories, it is not evident to me that europe is underperforming. gdp growth in the european union reached 2. 4 per cent in 2017. not since the boom period in the mid - 2000s we find higher growth rates. in sum, europe is better than its reputation. * * * [ slide 5 : ageing will weigh on future growth ] the growth observed last year might be as good as it gets. ageing populations and weak productivity gains will weigh on growth in advanced economies. europe is no exception. side 3 af 8 we have to adjust our expectations accordingly. demographics will shape the growth potential of europe. the share of europeans above 65 years went from 12 per cent in 1970 to 20 per cent in 2015. and it is expected to exceed 30 per cent by 2050. other advanced economies, most notably japan, face even greater challenges from an aging population. this demographic transition has important implications for economic growth. our estimates suggest that workforce ageing can reduce gdp per capita growth in europe by 0. 5 percentage points each year over the period 2020 - 2050. the demographic headwind can to some extent

reforms, involving interest rate deregulation, increased competition from banks, and lack of concessional funds have rendered the business models of development financial institutions ( dfis ) unsustainable ”. specifically for idbi bank, the percentage of gross npas between 1999 and 2003 ranged from 14. 07 % to 16. 86 % of total advances and the net npas ranged from 11. 64 % to 14. 82 % of net advances. 16. it was in this background that the government repealed the idbi act in 2003 and converted idbi limited into a banking company ( as industrial development bank of india limited ) for undertaking the entire gamut of banking activities. in view of the tough emerging competitive scenario in the indian financial sector, the managements of icici limited and icici bank had already merged their operations in 2002 to pursue a universal banking strategy. where does idbi bank go from here? 17. having seen the history of dfis and the gradual progression of idbi from a dfi into a commercial bank, let me now focus on the challenges that the bank is facing in its new avatar and what contribution can the unions make in helping the institution regain its primacy bis central bankers ’ speeches amongst the financial institutions of the country? before i go any further let me quote former rbi governor, dr. bimal jalan who aptly captured the thought process behind the conversion of dfis into universal banks. dr. jalan said “ the move towards universal banking would not provide a panacea for the endemic weaknesses of a dfi or its liquidity and solvency problems and / or operational difficulties arising from under - capitalization, non - performing assets, and asset liabilities mismatches etc. the overriding consideration should be the objectives and strategic interests of the financial institution concerned in the context of meeting the varied needs of customers, subject to normal prudential norms applicable to banks ”. 18. that brings us to the question what objective has idbi bank set for itself and how is it geared to achieve it? it is been around a decade since you became a commercial bank. are you satisfied with your performance? following conversion of the dfis into banks, the mantle of leading the developmental agenda has fallen on the commercial banks. with years of experience in developmental banking behind it, your institution was in a perfect position to lead this agenda. how do you view your achievement vis - a - vis the expectations the society has of you? here, i