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12:44 pm - Thursday February 22, 2018

BoI gets capital infusion of Rs 2,257 cr from central government

Agencies, New Delhi

The State run Bank of India on Saturday disclosed that it has received a capital infusion of Rs 2,257 crore from the central government.In a in a BSE filing, the public sector bank, which is in a process of strengthening its capital, said, “The bank has on December 29 received infusion of Rs 2257 crore from the Government of India, in form of Common Equity Tier-1 Capital, which is being kept as Share Application money and would be allocated after due procedure/conditions for allotment.”

It may be recalled that the central government, on October 24 had unveiled a Rs 2.11 lakh crore two-year roadmap for strengthening NPA-hit public sector banks, which includes re-capitalisation bonds, budgetary support and equity dilution.

Keeping the financial health of Bank of India, Reserve Bank of India (RBI) had initiated ‘prompt corrective action’ (PCA) against Bank of India (BoI) to stem losses from the huge non-performing assets (NPAs) of the bank.

As per the disclosed figures, the NPAs of the Bank of India had ballooned to Rs 49,306 crore at the end of the September 2017 quarter. BoI was forced to stop issuing issuing of fresh loans and dividend distribution by the RBI.

Bank was also asked not to open new branches. There was instruction of non recruitment of staff and giving increments to employees under the corrective action.
As per the reports, the bank’s asset quality worsened with gross NPAs at 13.22 per cent, as against 13.07 per cent in the previous year.

Posted in: Business

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