Rs.140 bn capital infusion for public sector banks okayedNovember 5th, 2011 - 1:04 am ICT by IANS
Chennai, Nov 4 (IANS) The Indian government has started assessing the capital needs of its banks as the Basel III norms come into force by 2013 while approving Rs.14,000 crore towards recapitalisation of the banks, said Minister of State for Finance Namo Narain Meena.
Speaking to reporters on the sidelines of Bancon-2011, a banking conference, here Friday, Meena said: “We have started work for assessing the capital needs of state owned banks as Basel III norms comes into force in 2013. We are committed to recapitalize the public sector banks to meet the growth needs.”
Basel III norms are the guidelines for assessing the capital needs of banks based on the risk profile and other parameters.
Meena said the government has approved Rs.14,000 crore towards recapitalisation of its banks for 2011-12 as against the demand of Rs.18,000 crore.
He said the banks have asked for a capital infusion of Rs.19,000 crore for 2012-13.
Earlier in his inaugural speech at the conference, Meena said the availability of sufficient capital provides significant comfort for implementation of the Basel III norms as per the schedule laid out by the Basel Committee on Banking Supervision.
Referring to the increasing interest rate regime, he said deterioration of asset quality cannot be ruled out.
He said the gross non-performing assets of commercial banks went up to 2.52 percent in June 2011 from 2.35 percent in March 2011, but the overall trend does not indicate any systemic problem.
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Tags: asset quality, bancon, banking conference, basel committee on banking supervision, basel iii, capital infusion, commercial banks, crore, inaugural speech, indian government, minister of state, namo, narain, non performing assets, norms, public sector banks, rate regime, recapitalisation, risk profile, systemic problem