Government sources on Thursday said that capital infusion into Public Sector Banks (PSBs) are likely to take place by the end of 2018.
As per the source, the recap burden is likely to be lower due to the unlocking of capital on the account of recent decisions taken by the Reserve Bank of India (RBI).
"A total of Rs. 43,000 crore is pending in terms of PSU bank recap is pending, while Non Performing Assets (NPAs) in the Micro Small and Medium Enterprise (MSME) sector has reduced to Rs. 1 lakh crore," added the source.
Overall, net NPAs are down to Rs. 27,000 crores in the last two quarters, the source further said.
On November 19, the RBI Central Board had decided to constitute a Board for Financial Supervision (BFS) to examine the framework for banks under Prompt Corrective Action (PCA).
The decision was taken after the RBI's Central Board meeting on Monday, which discussed the Basel regulatory capital framework, a restructuring scheme for stressed Micro, Small and Medium Enterprises (MSMEs), bank health under the Prompt Corrective Action (PCA) framework and the Economic Capital Framework (ECF).
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