PSU banks set to get ₹28,615 crore capital infusion
1 min read 27 Dec 2018, 03:48 PM ISTOf the seven state-owned banks, Bank of India is likely to get the highest amount of ₹10,086 crore
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New Delhi: The government is likely to infuse ₹ 28,615 crore into seven public sector banks (PSBs) through recapitalisation bonds by the end of this month, sources said on Thursday. This will help banks meet regulatory capital requirement. The disbursement is likely to take place before December 31, sources added. Out of the seven state-owned banks, Bank of India is likely to get the highest amount of ₹ 10,086 crore, followed by Oriental Bank of Commerce, which might get ₹ 5,500 crore through recapitalisation bonds, according to sources.
Other banks that are likely to receive capital infusion in this round include Bank of Maharashtra (Rs 4,498 crore), UCO Bank (Rs 3,056 crore) and United Bank of India (Rs 2,159 crore).
The government had earlier announced an infusion of ₹ 65,000 crore into PSBs in 2018-19, of which ₹ 23,000 crore had already been disbursed. Earlier this month, finance minister Arun Jaitley had said public sector banks will get an capital additional infusion of ₹ 41,000 crore. On December 20, the government sought Parliament’s approval for the same.
The recapitalisation, the finance minister said, will enhance the lending capacity of public sector banks and help them come out of the Reserve Bank of India’s Prompt Corrective Action (PCA) framework. Eleven out of the total 21 PSBs are under the central bank’s PCA framework, which imposes lending restrictions on weak banks. These include Allahabad Bank, United Bank of India, Corporation Bank, IDBI Bank, UCO Bank, Bank of India, Central Bank of India, Indian Overseas Bank, Oriental Bank of Commerce, Dena Bank and Bank of Maharashtra.
This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed
