Chinmaya IAS Academy – Current Affairs Chinmaya IAS Academy – Current Affairs
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The Finance Ministry would not curtail its capital infusion plan for this financial year even as state-owned banks would be needing lesser funds following the Reserve Bank’s decision to defer the deadline to meet Basel III norms by a year, according to sources.Under the new dispensation, the capital infusion by the government in public sector banks (PSBs) for meeting the capital buffer norms would come down to around Rs. 15,000-20,000 crore, sources said. However, there will not be any reduction in the capital funding plan as announced in October last year despite a lower requirement due to the RBI extending the deadline for meeting the CCB of 2.5%, under Basel-III norms, until March 2020, sources said. The extension could reduce the burden of PSBs by Rs. 35,000 crore this fiscal, according to rating agency Crisil.After assessing the requirement of each bank, the ministry is expected to finalise capital infusion of about Rs. 54,000 crore by this month-end or by the first half of the next month.
