PSBs may get more than budgeted: Jayant Sinha

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PSBs, Jayant Sinha, MoS Finance

The Centre is willing to give more than the ₹25,000 crore specified in the Budget for recapitalising public sector banks (PSBs), Minister of State for Finance Jayant Sinha said on Friday. “We have a clear sense of what the stressed assets mean on the banks’ balance sheets. The Budget has allocated ₹25,000 crore for recapitalisation and we can give more, if required,” he said, adding that the Reserve Bank had also done its bit by tweaking norms and easing the capitalisation norms of banks.

With stressed assets of scheduled commercial banks at an estimated ₹8 lakh crore, Sinha said that though the Centre had strengthened measures for its resolution, it is the Insolvency Code, once passed in Parliament, that would have a big impact.

“Stressed assets of scheduled commercial banks are at about ₹8 lakh crore as against the total loan book of ₹69 lakh crore. We will continue to work with those numbers to see how we can further expedite and strengthen the recovery process,” said Sinha, who was speaking at the second annual Gyan Sangam – a retreat of heads of public sector financial institutions, the Finance Ministry and the Reserve Bank of India.

Financial Services Secretary Anjuly Chib Duggal said steps to strengthen the legal framework for recovery by banks are on the anvil. “They may be announced on Saturday,” she said.

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