May 14, 2014 9:22 AM

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Govt likely to infuse additional capital of up to Rs. 8000 crore in public sector banks

The government is likely to infuse an additional capital of upto 8,000 crore rupees in the public sector banks during the current fiscal, to expand their capital base. This was disclosed by Financial Services Secretary GS Sandhu in New Delhi yesterday. He said, a provision of 11,500 crore rupees have been made in the interim budget. The government had infused 14,000 crore rupees in PSU banks during the last financial year.According to RBI, Indian PSU banks will require an additional capital of five lakh crore rupees to meet the new global banking norms.Mr. Sandhu also said that bad loans or Non Performing Assests in the PSUs are a cause of concern. He, however, added that due to vigorous recovery, cost cutting and cheaper funds of the banks, the NPA situation has improved in January-March quarter of 2014, as compared to October-December of 2013.He said, the gross NPAs in January to March quarter in 2013-14, came down to 4.44 per cent from 5.07 per cent in the previous quarter of October-December of the same fiscal. The Secretary said, the banks may go for change in management of the parties who wilfully do not clear their dues.

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