FinMin revises criteria for recapitalisation of PSBs

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State-owned banks looking forward to the next round of capital infusion will need to fulfill a new set of criteria, including credit recovery, as the finance ministry has revised the recapitalisation norms.

The second tranche of capital allocation for the current fiscal would be based on cost of operations as well as recovery and quality of credit on the basis of risk weighted assets, sources said.

Only those lenders that fulfil the criteria post third quarter (October-December) results of the current fiscal will be eligible for the second round of funding, sources added.

The money was allocated last fiscal on the twin principles of ensuring 7.5 per cent common equity tier 1 (CET 1) at the end of the 2016 and growth capital to five major banks.

The government in July had announced the first round of capital infusion of Rs 22,915 crore for 13 banks.

“75 per cent of the amount (Rs 22,915 crore)…Is being released now to provide liquidity support for lending operations as also to enable banks to raise funds from the market,” the finance ministry had said in a statement.

“The remaining amount, to be released later, will be linked to performance with particular reference to greater efficiency, growth of both credit and deposits and reduction in the cost of operations,” it had said.

The first tranche was announced with the objective to enhance their lending operations and enable them to raise more money from the market.

Out of the Rs 22,915 crore, State Bank of India (SBI) was provided Rs 7,575 crore followed by Indian Overseas Bank (Rs 3,101 crore) and Punjab National Bank (Rs 2,816 crore).

The other lenders, which have got commitment of capital infusion are Bank of India (Rs 1,784 crore), Central Bank of India (Rs 1,729 crore), Syndicate Bank (Rs 1,034 crore), UCO Bank (Rs 1,033 crore), Canara Bank (Rs 997 crore), United Bank of India (Rs 810 crore), Union Bank of India (Rs 721 crore), Corporation Bank (Rs 677 crore), Dena Bank (Rs 594 crore) and Allahabad Bank (Rs 44 crore).

The capital infusion exercise for the current fiscal is based on an assessment of need as per the compounded annual growth rate (CAGR) of credit growth for the last five years, banks’ own projections of credit growth and estimates of the potential for growth of each PSB, it had said.

Finance minister Arun Jaitley in his budget speech for 2016-17 had proposed to allocate Rs 25,000 crore towards recapitalisation of PSU banks. “If additional capital is required by these banks, we will find the resources for doing so. We stand solidly behind these Banks,” he had said.

 

Source: http://www.mydigitalfc.com/economy/finmin-revises-criteria-recapitalisation-psbs-539

RBI asks income tax assessees to pay dues in advance, 29 banks authorized to accept payments

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The Reserve Bank appealed to income tax assessees to pay dues in advance of the due date as well use alternate channels of authorized banks to avoid the rush during end of March.

“Pay I-T dues in advance at RBI or at authorized bank branches. Appeal to income tax assessees to remit their income tax dues sufficiently in advance of the due date,” RBI said in a release.

“It is observed that the rush for remitting Income-Tax dues through the RBI has been far too heavy towards the end of March every year and it becomes difficult for the RBI to cope with the pressure of issuing receipts although additional counters to the maximum extent possible are provided for the purpose”, it said.

RBI said assessees can use alternate channels like select branches of agency banks or the facility of online payment of taxes offered by these banks.

A total of 29 agency banks have been authorized to accept payments of Income-Tax dues. The authorised banks include SBI and its five associates, HDFC Bank, ICICI Bank, Axis, Bank, Punjab National Bank, Bank of Baroda, Bank of India, Indian Overseas Bank.

Among others are Corporation Bank, Dena Bank, Canara Bank, Central Bank of India, Syndicate Bank and others.
RBI said by remitting dues at the designated banks will obviate the I-T assessess’ inconvenience in standing in long queues at the RBI offices.

 

Source: http://www.firstpost.com/business/rbi-asks-income-tax-assessees-to-pay-dues-in-advance-29-banks-authorized-to-accept-payments-2628134.html?utm_source=FP_CAT_LATEST_NEWS