PSU banks can alter authorised share capital: FinMin
New Delhi: State-owned banks can now increase capital while issuing preference shares, rights issues or bonus shares without being limited by the earlier ceiling of Rs 3,000 crore, the Finance Ministry said on Friday.
The restriction has been removed following passage of the Banking Laws (Amendment) Bill 2012 in Parliament. The Bill will become a law after its is signed by the President.
The Ministry said the Bill will strengthen the regulatory powers of the Reserve Bank and further develop the banking sector in India.
"It will also enable the nationalised banks to raise capital by issue of preference shares or rights issue or issue of bonus shares.
"It would also enable them to increase or decrease the authorised capital with approval from the Government and RBI without being limited by the ceiling of a maximum of Rs 3,000 crore," the ministry added.
The government had to drop a controversial clause which would have allowed banks to enter into forward trading under intense opposition from different parties.
The Bill, which was passed by both the Houses of Parliament in the just concluded Winter Session, has also paved the way for new bank licences by RBI.
"This would not only help in achieving the goal of financial inclusion by providing more banking facilities but would also provide extra employment opportunities to the people at large in the banking sector," the ministry added.
More from India
More from World
More from Sports
More from Entertaiment
- 7th Pay Commission recommends 23.55% hike in salary for central govt employees; minimum salary set at Rs 18,000 per month
- Shocking fact of pay 'hike' in 7th Pay Commission recommendations!
- Full Report of 7th Pay Commission
- E-commerce war: Paytm Diwali sale offers 100% cashback on 25 million products
- Unbelievable! Clean and healthy meals on Indian Railways at just Rs 20