The Government of India announced that it has infused a total of INR145bn ($1.98bn) in four public sector lenders in the country.
The four banks are Indian Overseas Bank, Bank of India, Central Bank of India and UCO Bank.
According to local publications, the capital was injected by issuing non-interest bearing bonds.
Notably, all the banks, with the exception of Bank of India, are currently under the central bank’s prompt corrective action (PCA) framework. The PCA framework places restrictions on the banks’ lending and expansion plans.
In separate stock exchange filings, all four banks confirmed receiving capital infusion.
The statement from Indian Overseas Bank said: “We wish to inform that the bank has received a capital infusion of Rs 4,100 crore [INR41bn] from Government of India towards contribution of Central Government in the preferential allotment of equity shares of the bank during the financial year 2020-21, as government’s investment.”
The Bank of India filing said: “In terms of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, this is to inform that, today, Government of India has infused capital of Rs.3,000 Crore [INR30bn] in our Bank for the purpose of preferential allotment of equity shares after obtention of shareholder’s approval in the Extra Ordinary General Meeting and other related regulatory approvals.”
Central Bank of India received INR48bn, while UCO bank secured INR26bn.
The government infused another INR5.5bn into Punjab and Sind Bank in December last year.