The government has infused Rs 5,691 crore as part of its recapitalisation programme of banks to maintain their Tier I capital adequacy ratio in excess of 8 per cent up to July, the Reserve Bank of India (RBI) said today.
In the Union Budget 2010-11, the government has provided for recapitalisation of Rs 16,500 crore to help banks maintain a Tier I capital adequacy ratio in excess of 8 per cent.
"As a part of this programme, Rs 5,691 crore was infused up to the end of July 2010," the RBI said in its Report on Trend and Progress of Banking in India, released here.
Capital forms the basic requirement for banks to expand balance-sheets and thus, banks will have to raise substantially higher levels of capital in order to provide the adequate resources needed by a growing economy, it said.
The capital infusions have been in the form of direct equity and hybrid Tier I capital including perpetual non-cumulative preference shares, it said.