State Bank of India rises 1% on recapitalisation buzz

Country's largest lender State Bank of India gained more than one percent intraday to touch a new 52-week high of Rs 2,550 on Thursday on hopes of recapitalisation.
 
The government is likely to consider the proposal to infuse Rs 12,000 crore into public sector banks tomorrow. It is one of the agendas of the meeting (tomorrow), official sources said. The Finance Ministry has approved investment of Rs 12,000 crore in 12 public sector banks, including State Bank of India, Central Bank of India and United Bank of India .

The fund would be disbursed before March to these public sector banks. Country's largest lender SBI will get Rs 3,004 crore as part of recapitalisation plan to boost the bank's capital base.

Besides, the Finance Ministry will also seek Cabinet approval for fund infusion in the public sector banks till March 2018, sources said.

The Finance Ministry has made assessment of the capital needs of public sector banks for meeting Basel III norms to be complied in a phased manner, ending March 2018. As per the existing norms, capital infusion beyond Rs 300 crore in a company requires Cabinet approval.

Shares of Central Bank of India and United Bank of India rose nearly 1 percent.

(With inputs from PTI)