Dena Bank and Bank of Maharashtra along with United Bank of India may get recapitalised in the current financial year. The government has already earmarked Rs 18,000 crore for the recapitalisation exercise for 2009-10.
“However, a final decision on the issue is yet to be taken,” a banking source said. In addition, banks would look at launching public offers, once the stock market shows signs of stability.
Several banks such as Punjab and Sind Bank, United Bank of India, Central Bank of India and UCO Bank have sufficient headroom available to divest their stake. The government holding in public sector banks have to be a minimum 51 per cent.
“Visiting the markets would be an option once the stock market shows signs of recovery to make the best use of it,” a government official said.
In the last few years, PSUs have had to limit their disinvestment options due to stiff opposition from the Left parties, the erstwhile allies of the ruling UPA.
Meanwhile, the Cabinet had earlier approved infusion of Rs 3,800 crore into three banks — UCO Bank, Central Bank of India and Vijaya Bank. The fund would help these banks to shore up their capital adequacy ratio and bring it at a minimum level of 12 per cent. The move would also help these banks to carry on with the lending activities.