Public sector banks have approved more than 1.12 lakh loan applications of MSMEs totalling Rs 37,412 crore under the '59 minutes' loan scheme launched by the government in November.
The amount infused will help the banks meet regulatory capital requirement, and its disbursement might take place before December 31, PTI reported quoting sources.
"Today we have asked for the parliamentary sanction for (issuing) additional recapitalisation bonds of Rs 41,000 crore... As of today, of the Rs 65,000 crore recapitalisation plan for 2018-19, Rs 42,000 crore is still remaining.
Bank of Baroda also had NPAs to the tune of Rs 46,454 crore, Canara Bank Rs 41,907 crore, Central Bank of India Rs 37,411 crore, Indian Overseas Bank Rs 35,607 crore and UCO Bank Rs 28,822 crore.
As part of the capital infusion plan announced by the Finance Ministry in October 2017, the government envisaged that public sector banks (PSBs) would raise Rs 58,000 crore from the stock markets by March 2019 to meet Basel III norms.
The government's move comes against the backdrop of defaults by liquor baron Vijay Mallya, fugitive diamantaires Mehul Choksi and Nirav Modi.
Most of the banks, including SBI, PNB and BoB, have already informed their customers that functioning of branches and offices will be impacted if the strike takes off.
The Centre, however, declined to name the defaulters, citing a section of the RBI Act which prohibits it from disclosing credit information given by banks.
MoS for Finance Shiv Pratap Shukla said that the number of wilful defaulters was 9,063, which represents a marginal increase of 1.66 per cent during the nine months of the current financial year.
In a directive to Managing Directors (MDs) of all public-sector banks, the finance ministry has asked them to detect bank frauds and consequential wilful default in time and refer such cases to CBI.
The industry body said PSB senior managements spend bulk of their time "receiving and implementing directions from the bureaucrats even for innocuous issues."
Worse may not be over for the banking sector. As the bad loans are on a steady rise, new RBI guidelines are expected to add over Rs 2.8 trillion worth of loans in NPA category.
Finance Minister Arun Jaitley is expected to unveil provisions to make things move fast in positive direction and to continue the momentum to energise the lenders.
The Government today announced that it will infuse Rs 2.11 lakh crores in public sector banks to provide them relief from mounting pressures of non-performing assets (NPAs).
"The main objective of this flows from the Government's responsibility to keep public sector banks in good health," FM Jaitley told media at a press conference in New Delhi.
The interest subvention is given to public sector banks (PSBs), private lenders, cooperative banks and regional rural banks (RRBs) on use of own funds and to Nabard for refinance for RRBs and cooperative banks.
The Rs 80,000-crore expenditure has been sought by the government in form of the Third Batch of Supplementary Demands for Grants for 2017-18.
The decision of the Reserve Bank to initiate a ‘prompt corrective action’ (PCA) against large state-owned lender Bank of India led to rumours that the government may close down some banks.
Interest burden of Rs 1.35 lakh crore recapitalisation bonds on the government would be about Rs 9,000 crore, Chief Economic Adviser Arvind Subramanian said on Tuesday.
The Union Cabinet on Tuesday announced an aggressive Rs 2.11 lakh crore capital infusion for the NPA-hit public sector banks (PSBs) over a period of two years.
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