NEW DELHI: The government is all set to bail out IDBI BankBSE 0.00 % with a Rs. 3,000-crore capital infusion to help it maintain a healthy capital-adequacy ratio and pursue credit growth. The government has already said it is still open to bring down its stake in the bank to below 50 per cent.
"There are projections that in the last quarter of this fiscal there will be a jump in bad loans for IDBI. We are behind the bank and the amount allocated will help maintain stability," said a senior finance ministry official.
Other state-run banks will also require immediate capital support, the finance ministry reckons. "About seven state-run banks have reported net profit over the past three quarters. There has also been substantial improvement in recoveries done by some lenders, including Indian Overseas Bank," he said.
On the other hand, IDBI Bank’s lending portfolio is mostly in corporate segment and that is one of the major reasons for surge in its bad loans.
IDBI reported a net loss of Rs.2,255 crore in December quarter against Rs.2,184 crore in the year-ago period. Gross non-performing assets (GNPAs) rose to Rs. 35,245 crore at December-end 2016 from Rs.30,134 crore in the previous quarter. The current Tier-I capital stands at 8.53 per cent.
Economic TImes
"There are projections that in the last quarter of this fiscal there will be a jump in bad loans for IDBI. We are behind the bank and the amount allocated will help maintain stability," said a senior finance ministry official.
Other state-run banks will also require immediate capital support, the finance ministry reckons. "About seven state-run banks have reported net profit over the past three quarters. There has also been substantial improvement in recoveries done by some lenders, including Indian Overseas Bank," he said.
On the other hand, IDBI Bank’s lending portfolio is mostly in corporate segment and that is one of the major reasons for surge in its bad loans.
IDBI reported a net loss of Rs.2,255 crore in December quarter against Rs.2,184 crore in the year-ago period. Gross non-performing assets (GNPAs) rose to Rs. 35,245 crore at December-end 2016 from Rs.30,134 crore in the previous quarter. The current Tier-I capital stands at 8.53 per cent.
Economic TImes
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