BOI, UBI issue pref shares worth Rs 3,534 cr to govt

Public sector lenders Bank of India (BOI) and Union Bank of India (UBI) have issued equity shares worth Rs 2,455 crore and Rs 1,079 crore respectively to the government on preferential basis for capital infusion.
"Consequent to the receipt of capital funds from government to the tune of Rs 1,079.99 crore, the bank has on September 30, 2015 issued and allotted 5,16,62,281 at an issue price of Rs 209.05 per equity share on preferential basis," UBI said in a BSE filing today.
In a separate filing, Bank of India said it has allotted 12,70,04,655 equity shares to government on September 30, 2015.

"Consequently, shareholding of government has increased from 64.43 per cent to 70.13 per cent and correspondingly, the non-government shareholding has decreased from 35.57 per cent to 29.87 per cent," it added.
BOI will get a capital infusion of Rs 2,455 crore by way of increased government shareholding.
Earlier in August this year, the government had decided to infuse Rs 20,088 crore in 13 public sector banks (PSBs), including SBI, Punjab National Bank, IDBI, Canara Bank, Corporation Bank and a few others.

The government has laid out a road map for Rs 70,000 crore of capital infusion in PSBs over four years.

Of this, Rs 25,000 crore is marked for 2015-16 and 2016-17 each and Rs 10,000 crore for 2017-18 and 2018-19 each.
It is estimated that public sector banks will require capital of Rs 1.80 lakh crore over four years. Of this, banks will have to raise Rs 1.10 lakh crore from the market.
As of now, the PSBs are adequately capitalised and meeting all the Basel-III and RBI norms.
However, government wants to adequately capitalise all the banks to keep a safe buffer over and above the minimum norms of Basel-III.