About three quarters of the banking deposits go to government owned banks that currently have invested over one-third of the assets in government securities and a perceptible amount in PSU bonds, development financial institutions cooperatives and government guaranteed enterprises. This gives place to a criticism that government owned banks are operating as instruments to finance high public sector deficits.
Secondly, the allocation of these resources should be in a transparent manner; it should be done through an auction or open market bidding. Well-designed auctions can promote the efficient allocation of resources without requiring governments to have full prior knowledge of resource values or costs.