India to infuse 38 bln rupees into 3 banks
The Indian government will infuse 38 billion rupees into three state-run banks by the end of March 2010, a minister said Wednesday, helping their shares extend gains in a market that ended almost unchanged.
Indian banks have been unable to raise fresh equity after the global financial crisis roiled Indian markets, but they have to adhere to the central bank’s capital adequacy rules and meet rising demand for loans needed to prime the slowing economy.
On Wednesday, Home Minister Palaniappan Chidambaram said the federal cabinet approved a proposal to put funds into UCO Bank (UCBK.BO: Quote, Profile, Research), Central Bank of India (CBI.BO: Quote, Profile, Research) and Vijaya Bank (VJBK.BO: Quote, Profile, Research) by subscribing to their shares.
“Today accessing the capital market is not a viable option. Capital is required. Therefore, we decided to infuse capital,” Chidambaram told a news conference.