Bankers, analysts welcome recapitalisation move

The move will have cascading effects for lot of related sectors, said SBI chairman Rajnish Kumar

The government’s recapitalisation plan can give a big push to the anaemic credit growth in the system, as banks now will have enough money to take care of their stressed loans as well as to support green shoots of recovery in certain pockets in the industrial sector.

The finance ministry on Tuesday said it will issue Rs 1.35 lakh crore of recapitalisation bonds to banks and another Rs 76,000 crore will be infused through budgetary support and market borrowings. The plan is to infuse Rs 2.11 lakh crore over two financial years, 2017-18 and 2018-19.

It is expected that banks will subscribe