Finance Minister Arun Jaitley unveils ‘Banks Recapitalization Plan’ to strengthen Public Sector Banks
 Source : NewsBharati  Date : 24-Jan-2018

New Delhi, January 24: In regard to the bank recapitalisation package, Union Finance Minister Arun Jaitley in a press conference shared details of the banking department working on recapitalisation plan to strengthen the public sector banks.


 

While addressing in the press conference he said that government has the prime responsibility of keeping the public sector banks in good health. He further added that the department ensures to build an institutional mechanism which will ensure that the problems which occurred earlier will not recur. He went on to add that banks should follow the highest standard of governance and there is a need for institutional mechanism to ensure past is not repeated.

Laying out details of the massive bank recapitalisation plan for public sector banks (PSBs), Arun Jaitley said that the finance ministry is working on two aspects.

The first aspect comprises; the basis on which the banks are being chosen for recapitalisation and how much money is to be inducted into which bank. The second aspect holds the various steps to be taken to ensure that the governance of the banks follows highest standards.

 

Finance Secretary Rajiv Kumar laid down 6-point reforms for the PSBs and said their performance will be under the annual assessment. Of the 21 PSBs, IDBI will be getting the highest capital of Rs 10,610 crore from the government. Out of the total PSU banks IDBI Bank emerged as the biggest beneficiary today as the bank was allocated a whopping Rs 10,610 crore followed by Bank of India (Rs 9,232 crore), SBI (Rs 8,800 crore), UCO Bank (Rs 6,507 crore) and Central Bank (Rs 5,158 crore).
 
Ahead in the press conference, Rajiv Kumar, Finance Service announced details of Rs 2.1-trillion bank recapitalisation programme. He also said that bank recapitalisation is dependent on performance and reforms and that loan above Rs 2.5 billion will undergo special monitoring. 

The government this month pursued the parliament approval for Rs 80,000 crore that it plans to spend by March, as part of a two-year recapitalisation programme for state-run banks to help them deal with bad debts and revive credit growth.