PSBs may find it hard to raise money on asset quality, governance concerns

Public sector banks (PSBs) would find it difficult to raise capital from private investors owing to asset quality concerns and a delay in implementing governance reforms, say experts.
 

While the banks have cleaned up books and the space has seen consolidation after the merger exercise, the impact of big-ticket frauds of the past and the bad-loan burden remain an issue.
 

This is reflected in the less-than-enthusiastic response to the recent Qualified Institutional Placements (QIPs) of Punjab National Bank and IDBI Bank, say two executives with merchant banks involved in the capital raising plans.
 

Technically, IDBI Bank is a private sector