SBI may get up to Rs 6,000 cr capital infusion this fiscal
New Delhi: Country's largest lender State Bank of India (SBI) on Thursday said it is likely to get a capital infusion of up to Rs 6,000 crore in the current fiscal from the government that will help the lender increase its operations.
"I have received a letter from the finance ministry on recapitalisation. The amount is likely to be between Rs 5,000-6,000 crore this fiscal," SBI Chairman Pratip Chaudhuri told reporters here.
The government has already announced that it is committed to providing adequate capital to public sector banks so as to maintain their tier-I capital at 8 percent.
The capital infusion into SBI, Chaudhuri said, "will put tier I capital at 9 percent".
As of September, 2011, the capital adequacy ratio (CAR) of SBI stood at 11.4 percent. Of this, tier-I capital stood at 7.7 percent at the end of first quarter against minimum 8 percent level desired by the government.
The Government of India, which holds 59.4 percent stake in SBI, has earmarked Rs 6,000 crore for the fiscal for capital infusion in public sector banks to ensure that they meet the regulatory requirements.
In 2010-11, the government had provided capital support to the tune of Rs 20,157 crore to public sector banks.
SBI had submitted proposal some months ago to raise Rs 20,000 crore through a rights issue. The bank requires Rs 20,000 crore to fund its growth plans over the next two fiscals.
Shares of SBI closed at Rs 1,691.70, down 0.20 percent over previous close on the BSE.