The Narendra Modi government gave approval to a planned recapitalization of 12 public sector Banks(PSB). This will also include fraud hit Punjab National Bank(PNB).
The government is planning to infuse around ₹48,000 Crore in 12 PSB. As part of the plan, Allahabad Bank will receive ₹6,896 Crore, ₹9,086 crore will be infused in Corporation Bank and ₹5,908 crore in the recent fraud hit Punjab National Bank(PNB).
The other banks include UCO Bank, Andhra Bank, Bank of Maharashtra, Bank of India and United Bank all these bank among others are part of the recapitalization plan by the central government.
“This is positive as it comes at a time when NBFCs are facing liquidity issue, and the capital will help some banks to be kept out of PCA so that lending can pick up and increase market share of public sector banks specially the recent banks which have exited PCA. We have BUY rating on Allahabad Bank, Bank of India and Oriental Bank of Commerce,”said Sameer Kalra – Equity Research Analyst at Target Investing.
Earlier in December, the government had infused ₹28,615 crore into seven public sector banks through recapitalization bonds.