ADVERTISEMENT

No Capital Injection Needed For Public Sector Banks, Says MoS Finance Bhagwat Karad

Total amount of capital injections into PSBs during last five financial years stood at Rs 2.86 lakh crore.

<div class="paragraphs"><p>File image of the current Parliament building in Delhi.&nbsp;(Photo: Reuters)</p></div>
File image of the current Parliament building in Delhi. (Photo: Reuters)

The Indian government does not foresee the need to inject more capital into public sector banks, according to Minister of State for Finance Bhagwat Karad.

"In view of the strong capital position of the PSBs and their ability to raise capital from the market, no recapitalisation requirement for PSBs is envisaged currently," Karad told the Lok Sabha in a written reply to a question. All the PSBs have now also come out of the RBI’s prompt corrective action framework, he said.

The total amount of capital injections into PSBs during the past five years, between FY18 and FY22, amounts to Rs 2.86 lakh crore.

PSBs recorded an all-time high annual net profit of Rs 66,540 crore in FY22, and their ratio of net non-performing assets has gone down from 7.97% in March 2018 to 1.45% in December 2022, Karad said in his reply. State-run banks have also raised capital worth Rs. 2.64 lakh crore from the capital markets during the same period.