Govt decides to infuse Rs 48,239 crore in 12 state run Banks | Current Affairs, Current Affairs 2019

Govt decides to infuse Rs 48,239 crore in 12 state run Banks

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Aiming to maintain the regulatory capital requirement and financial growth plans, the Finance Ministry has announced to pump in Rs. 48,239 crore in 12 public sector banks this fiscal year.

According to an official release, The total amount of capital infusion would increase to Rs. 1,00,958 crore of the planned recapitalisation of Rs. 1.06 lakh crore for PSU banks for the current fiscal year including this funding. The remaining Rs. 5,000 crore capital infusion would be used as buffer for any contingency or growth capital for Bank of Baroda which is in the process of merging Dena Bank and Vijaya Bank with itself. It (pending Rs. 5000 crore) may be used for any contingency or for growth capital wherever it is necessary including amalgamated entity of Bank of Baroda. Corporation Bank is the biggest beneficiary of this round of capital infusion with Rs. 9,086 crore of funding, followed by Allahabad Bank with Rs. 6,896 crore. Rs. 4,638 crore and Rs. 205 crore will be provided to Bank of India and Bank of Maharashtra respectively. These banks have recently come out of the regulatory supervisory framework PCA of the RBI. Punjab National Bank will get Rs. 5,908 crore, Union Bank of India Rs. 4,112 crore, Andhra Bank Rs. 3,256 crore and Syndicate Bank Rs. 1,603 crore. The government will pump in Rs. 12,535 crore in four other banks under PCA — Central Bank of India, United Bank, UCO Bank and Indian Overseas Bank.

The government in December had increased the outlay by Rs. 41,000 crore for infusion in public sector banks. As a result, the total recapitalisation in the current fiscal year from Rs. 65,000 crore to Rs. 1.06 lakh crore. Subsequently, the government infused Rs. 28,615 crore into seven public sector banks (PSBs) through recapitalisation bonds.

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