Government has allocated Rs. 22, 915 crore to 13 public sector banks for capital infusion in fiscal year 2016-17. Union Budget 2016-17 had allocated Rs. 25,000 crore for bank recapitalization this fiscal.
country’s largest public sector bank State Bank Of India has been allocated maximum amount of capital for re-capitalization of Rs 7,575 crore followed by IOB and PNB of Rs. 3101 Crore and Rs. 2816 Crore respectively. The least is for Allahabad Bank at Rs 44 crore.
According to a Ministry of Finance release, the capital infusion is based on “needs as assessed from the CAGR of credit growth for the last five years, banks’ own projections of credit growth and an objective assessment of the potential for growth of each PSB.”
Government has also confirmed that 75% of the amount collected for each bank is being released now to provide liquidity support for lending operations as also to enable banks to raise funds from the market.
Remaining amount will be released later which is linked to performance, with particular reference to greater efficiency, growth of both credit and deposits and reduction in the cost of operations.
Allocation break-up of Rs.22, 915 crore as released by Ministry of Finance.
||Name of Bank
||Amount (in crore)
||Bank of India
||Central Bank of India
||Indian Overseas Bank
||Punjab National Bank
||State Bank of India
||Union Bank of India
||United Bank of India