In order to bring the state-run lenders out of prompt corrective action (PCA) framework of Reserve Bank of India (RBI), the government on Wednesday announced to pump in Rs 48,239 crore in 12 public sector banks (PSBs) in this fiscal.

Currently, eight PSU banks — Corporation Bank, Allahabad Bank, IDBI Bank, UCO Bank, Central Bank of India, Indian Overseas Bank, Dena Bank and United Bank of India — are still under the PCA framework.

Corporation Bank is the biggest beneficiary of this round of capital infusion with Rs 9,086 crore of funding as its common equity tier (CET) 1 ratio will be nearly 17 percent post the recapitalisation.

With Rs 6,896 crore infusion, Allahabad Bank is the second biggest beneficiary, whose CET 1 ratio will be above 12.5 percent post the recapitalisation.

While Punjab National Bank (PNB) received Rs 5,908 crore recapitalisation, its CET I ratio will improve only by 147bps to 9.72 percent.

To bring Allahabad Bank and Corporation Bank above regulatory PCA threshold, the government will infuse Rs 15,982 crore capital in these two lenders.

Further, Rs 4,638 crore and Rs 205 crore will be provided to Bank of India and Bank of Maharashtra. These banks have recently come out of the regulatory supervisory framework PCA of the RBI.

Four PSBs – PNB, Union Bank of India, Andhra Bank and Syndicate Bank – have been given Rs 14,879 crore so that they don’t breach PCA thresholds.

Also, 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.

First Published:Feb 20, 2019 10:41 PM IST