22 C
New Delhi
Tuesday 19 November 2019
Economy Govt to infuse Rs 88,139 crore in PSBs this...

Govt to infuse Rs 88,139 crore in PSBs this fiscal


- Advertisment -

Subscribe to our newsletter

You will get all our latest news and articles via email when you subscribe

The email despatches will be non-commercial in nature
Disputes, if any, subject to jurisdiction in New Delhi

New Delhi: The government today said it will infuse an unprecedented Rs 88,139 crore capital in 20 public sector banks (PSBs) before 31 March to boost lending and revive growth, and unveiled steps to tackle the bad loan problem which has reached record levels.

The lenders, which include State Bank of India, account for more than two-third of India’s banking assets as well as most of the over Rs 8 lakh crore of non-performing assets (NPAs) or bad loans.

Announcing the banking sector reforms, Finance Minister Arun Jaitley said stringent norms for disbursal of high value loans have been framed, with strict surveillance on big loan defaulters and mandatory reporting of loans of over Rs 250 crore.

Bank have also been instructed to become more professional.

The capital infusion is part of the massive Rs 2.11 lakh crore bank recapitalisation plan announced by the government in October last year. It is spread over two fiscal 2017-18 and 2018-19.

The finance ministry will raise Rs 80,000 crore through recapitalisation bonds and provide another Rs 8,139 crore from the Budget to recapitalise the banks.

The total recapitalisation will cross Rs 1 lakh crore in the fiscal ending 31 March 2018 after including funds raised from sales of shares to external investors, said Rajeev Kumar, Secretary, Department of Financial Services.

The banks have so far raised Rs 10,312 crore from the capital markets and more are expected to be raised in the remaining period of the 2017-18 fiscal.

Of the Rs 2.11 lakh crore bank recapitalisation plan announced in October last year, Rs 1.35 lakh crore was to come through the sale of bonds and Rs 76,000 crore through budgetary support and from the market.

Such bonds would not impact government’s target to shrink the fiscal deficit to 3.2% of GDP in current fiscal as IMF’s rules classify such debt as “below-the-line” financing.

Banks will have to adopt the differentiated business strategy and exit from non-core businesses and focus on their core competencies. “This is no easy money (that the banks will get),” Kumar said, adding that PSBs will be adequately capitalised.

The Rs 1 lakh crore more in capital enables additional credit offtake capacity of PSBs by more than Rs 5 lakh crore.

The banks will have to keep a strict watch on lending and recovery and undertake specialised monitoring of loans over Rs 250 crore. Besides, the PSBs need to have a dedicated stressed assets management vertical.

The banking sector in India is staring at Rs 10 lakh crore worth non-performing loans, which has hindered their lending capability.

During the current fiscal, IDBI Bank will get highest infusion of Rs 10,610 crore, followed by State Bank of India (Rs 8,800 crore) and Bank of India, Rs 9,232 crore.

UCO Bank will get Rs 6,507 crore; Punjab National Bank – Rs 5,473 crore; Bank of Baroda-Rs 5,375 crore; Central Bank of India-Rs 5,158 crore; Canara Bank-Rs 4,865 crore; Indian Overseas Bank-Rs 4,694 crore and Union Bank of India-Rs 4,524 crore.

Oriental Bank of Commerce would get Rs 3,571 crore; Dena Bank-Rs 3,045 crore; Bank of Maharashtra-Rs 3,173 crore; United Bank of India-Rs 2,634 crore; Corporation Ban-Rs 2,187 crore; Syndicate Bank-Rs 2,839 crore; Andhra Bank-Rs 1,890 crore; Allahabad Bank-Rs 1,500 crore, Punjab and Sind Bank-Rs 785 crore.


Leave a Reply


Anil Ambani: From Status Of Tycoon To Insolvency

Study the career of Anil Ambani, and you will get a classic case of decisions you ought not take as a businessman and time you better utilise

तवलीन सिंह, यह कैसा स्वाभिमान?

‘जिस मोदी सरकार का पांच साल सपोर्ट किया उसी ने मेरे बेटे को देश निकाला दे दिया,’ तवलीन सिंह ने लिखा। क्या आपने किसी क़ीमत के बदले समर्थन किया?

Rafale: One Embarrassment, One Snub For Opposition

Supreme Court accepts Rahul Gandhi's apology for attributing to it his allegation, rejects the review petition challenging the Rafale verdict

Guru Nanak Jayanti: What First Sikh Guru Taught

While Guru Nanak urged people to 'nām japo, kirat karo, vand chhako', he stood for several values while he also fought various social evils

Muhammed Who Inconvenienced Muslims

Archaeologist KK Muhammed had earlier got on the nerves of the leftist intelligentsia for exposing their nexus with Islamic extremists
- Advertisement -


Owaisi takes on Banerjee as ‘secular’ lobby splits like 2002

Reacting to West Bengal Chief Minister Mamata Banerjee's flagging of the issue of "minority bigotry", All India...

Rahul Gandhi’s absence exposes funny AI of cameras in LS

When Congress MP K Suresh spoke from the seat designated to Rahul Gandhi, the Lok Sabha LED screen flashed a misrepresentative caption

Bharat Ratna to Savarkar needs no recommendation: Govt

BJP manifesto for Maharashtra had pledged to recommend Bharat Ratna for Savarkar to the Centre if it could form government in the State

JNU students hold Delhi to ransom; police turn ingenious to disperse the mob

Police have rubbished reports that said the cops had unleashed lathi-charge on JNU students and said the men in khaki were just persuasive

Ayyappa devotee in Sabarimala: I’m 9, will wait for 41 years

The agitation over women's entry into the shrine of Lord Ayyappa has witnessed several ironies in the past one year; here are 5 glaring ones

You might also likeRELATED
Recommended to you

For fearless journalism

%d bloggers like this: