Government to infuse Rs 55,000 crore into Public Sector Banks in a week.

NewDelhi: The government has decided to infuse Rs 55,000 capital in Public Sector Banks (PSBs) under consolidation process in a week’s time.

FM Nirmala Sitharaman had announced the capital infusion of the aforesaid amount in 10 PSBs to be consolidated into 4 large Banks so that their capital base can be improved.

Under the fund infusion, Punjab National Bank will get Rs 16,000 crore, Union Bank of India Rs 11,700 crore, Canara Bank Rs 6,500 crore, Indian Bank Rs 2,500 crore, Bank of Baroda Rs 7,000 crore, Indian Overseas Bank Rs 3,800 crore and Central Bank of India Rs 3,300 crore.

On August 30, Sitharaman announced the merger of 10 PSBS. Punjb National Bank, Oriental Bank and United Bank will be merged to become the second largest PSU Bank in India. Canara Bank and Syndicate Bank will be merged into one entity to be 4th largest PSB, while Union Bank of India, Andhra Bank and Corporation Bank will be amalgamated into a single entity to be the 5th largest PSB; and Indian Bank and Allahabad Bank will become one entity to be the 7th largest PSB.

The Finance Minister further said that the Bank of India and Central Bank of India would remain independent.

FM Nirmala Sitharamanin had in June this year told the Rajya Sabha that over the last four Financial Years, the government has taken comprehensive steps to strengthen the Public Sector Banks, under Government’s 4R’s strategy of recognising NPAs transparently, resolving and recovering value from Stressed Accounts through clean and effective laws and processes, recapitalising banks, and reforming banks through the PSB Reforms Agenda.