This is a developing story…
At least four public sector banks are set to receive additional capital from the government, as part of its augmented recapitalisation plan.
Bank of India is set to receive Rs 10,000 crore in capital, which is the highest among all banks in the current batch, according to a senior official of the bank speaking on conditions of anonymity.
Kolkata-based UCO Bank is set to receive Rs 3,076 crore, while Central Bank of India will receive Rs 1,648 crore, according to senior officials from both these banks.
United Bank of India told stock exchanges that it will receive Rs 2,159 crore from the government under the plan.
This capital will help public sector banks meet minimum capital requirements under Basel III and may also help them lend more. At least 11 public sector banks, including the four mentioned above, are under the prompt corrective action (PCA) framework of the Reserve Bank of India (RBI) and are facing lending restrictions, owing to their high bad loan ratios and weak capital base.