Central Bank of India to get capital support of Rs 2,406 cr

Central Bank of India to get capital support of Rs 2,406 cr New Delhi: State-owned Central Bank of India Wednesday said it proposes to raise Rs 2,406 crore by issuing preference shares to the government.

The board has approved raising of additional equity capital up to the extent of Rs 2,406 crore by way of issue equity shares in favour of Government of India on preferential basis, Central Bank of India said in a filing on the BSE.

This is subject to regulatory and shareholder approvals, it added.

Earlier this month, the government approved infusion of Rs 12,517 crore in around 10 state-owned banks over the next three months.

"Pursuant to the Budget announcement made by the Finance Minister on March 16, 2012, we are infusing additional capital into the public sector banks. We will infuse before the end of this fiscal year a sum of Rs 12,517 crore," Finance Minister P Chidambaram had said.

"We think about 9-10 banks will get the money...This will enable the banks to maintain the Tier I CRAR (capital to risk-weighted assets ratio) at a comfortable level and will be compliant to stricter capital adequacy norms of Basel III whenever Basel III is implemented," he had said.

The government infused about Rs 20,117 crore in public sector banks during 2010-11, and Rs 12,000 crore in 2011-12.

PTI