Bangalore, Aug 5 (IANS) State-run banks remained shut across Karnataka Friday as thousands of employees began a daylong strike against privatisation and entry of foreign direct investment (FDI) in the banking sector.

"The daylong stir is not for salary hike but against the government's attempt to privatise state-run banks, allow FDI in the banking sector and outsourcing bank jobs," All India Bank Employees Association's state unit president Srinivas Babu told IANS.

About 10,000 employees of various banks marched in a procession to Freedom Park from the State Bank of Mysore in the city's commercial centre, raising slogans against the Indian Banks Association (IBA), a representative body of bank managements, and the government, and commenced sit-in demonstration (dharna).

Though the protest stir crippled business transactions, limited cash withdrawal and minimal operations remained unaffected due to proliferation of ATMs (automatic teller machines) across this city and the state, and extensive use of credit and debit cards by thousands of customers.

Long queues were seen at many ATMs after 11 a.m. in commercial and residential localities in Bangalore and other cities and towns across the state as customers were caught off-guard over the strike. However, the unions claimed that the public was informed Thursday.

"We have decided to go ahead with the daylong stir after conciliatory talks between bank unions and the government through the IBA failed in New Delhi Wednesday. We regret the inconvenience caused to the public for a day," Babu said.

Transactions and operations of private banks and branches of overseas banks, however, remained unaffected as their employees are not members of bank unions.

Inter-bank and intra-bank transactions and cheque clearances were, however, at a standstill.