Sunday, Sep 19, 2021
Outlook.com
Outlook.com

Public Sector Banks To Raise Rs 25,000 Crore In Next 3 Months:

RBI Governor Shaktikanta Das has been advising banks to proactively raise capital and not wait for a difficult situation to arise amidst Covid crisis

Public Sector Banks To Raise Rs 25,000 Crore In Next 3 Months:
Representational Image of Public Sector Bank
Public Sector Banks To Raise Rs 25,000 Crore In Next 3 Months:
outlookindia.com
2020-12-20T11:38:28+05:30

Public sector banks (PSBs) are planning to raise about Rs 25,000 crore through a mix of equity and debt in the next three months to support credit pick up and meet regulatory requirement.

In the last few months lenders including State Bank of India, Canara Bank and Punjab National Bank (PNB) have raised about Rs 40,000 crore from the market, Financial Services Secretary Debasish Panda told PTI in an interview.

"Banks have been able to raise a lot of money from the markets. About Rs 40,000 crores have been raised by the public sector banks both in the form equity and also AT1 and Tier II bonds. We will expect another 20,000-25,000 during the remaining part of the financial year," he said.

Earlier this month, Canara Bank raised Rs 2,000 crore while Punjab National Bank (PNB) raised Rs 3,788.04 crore through qualified institutional placement (QIP).

RBI Governor Shaktikanta Das has been advising banks to proactively raise capital and not wait for a difficult situation to arise due to the ongoing COVID-19 crisis.

Besides, the government has allocated Rs 20,000 crore for capital infusion into PSBs in the current fiscal. Of this, the Finance Ministry has granted Rs 5,500 crore to Punjab & Sind Bank to meet the regulatory requirement. The government approved capital infusion through preferential allotment of equity shares in Punjab & Sind Bank last month.

During 2019-20, the government made Rs 70,000 crore capital infusion into the PSBs to boost credit for a strong impetus to the economy.

Punjab National Bank got Rs 16,091 crore, Union Bank of India received Rs 11,768 crore while Canara Bank and Indian Bank got Rs 6,571 crore and Rs 2,534 crore, respectively.

Talking about the financial health of banks, Panda said that 11 out of the 12 public sector banks have posted profit in the last quarter.

Even gross non-performing assets (NPAs) have gone down substantially and the provision coverage ratio has increased, he said.

"There is some scope for improvement on return on assets and banks are working on that. By and large all the financial parameters are showing very very positive results," he said.

Advertisement

Outlook Newsletters

Advertisement

Read More from Outlook

Sonia Gandhi Likely To Name New Punjab CM Today

Sonia Gandhi Likely To Name New Punjab CM Today

After the resignation of Captain Amarinder Singh, the Congress legislative party (CLP) in a meeting in Chandigarh on Saturday authorized party president Sonia Gandhi to name the new CM.

Inside Kerala’s Pazhur Village – Where Nipah Broke Out And Was Contained

Inside Kerala’s Pazhur Village – Where Nipah Broke Out And Was Contained

A discipline earned while tackling Covid-19 may have saved Kerala from a wide outbreak of Nipah. Despite thin resources, the state health machinery kicked in to put checks in place.

Return Of Campus Life As Colleges Reopen After Long Pandemic Shutdown

Return Of Campus Life As Colleges Reopen After Long Pandemic Shutdown

After befriending gadgets for attending online classes students finally are back to real books and real conversations. Read more education stories in our latest issue.

Militant Recruitment In Valley Down As Youth Are ‘Acting Wisely’: J&K Police Chief

Militant Recruitment In Valley Down As Youth Are ‘Acting Wisely’: J&K Police Chief

J&K DGP Dilbagh Singh said the militant attacks taking place in the Valley reflect the frustration of pro-Pakistan forces.

Advertisement