5-7 public sector banks likely to get more funds soon: Finance ministry

The Rs15,000-crore fund infusion for tier I capital instruments of PSBs would enable them to expand their credit growth by about Rs1,85,000 crore

As many as seven public sector banks (PSBs) may get additional capital from the government shortly, financial services secretary R Gopalan said in New Delhi today, reports PTI.

The banking division has sought the approval of finance minister Pranab Mukherjee in this regard, Gopalan said, adding, "We are seeking the finance minister's approval...
 Five-seven banks are to be recapitalised shortly".

The government plans to provide financial support of Rs15,000 crore to public sector banks during the current fiscal. The Cabinet has already approved a capital infusion plan that will increase the lending capacity of state-run banks by Rs1.85 lakh crore.

The exact amount, the mode of capitalisation and other terms would be decided in consultation with the banks at the time of infusion.

The Rs15,000-crore fund infusion for tier I capital instruments of PSBs would enable them to expand their credit growth by about Rs1,85,000 crore. This additional credit availability is likely to benefit employment-oriented sectors, especially agriculture, micro and small enterprises and entrepreneurs.

Last week, the government infused Rs1,500 crore into four public sector banks-Vijaya Bank, United Bank of India, Uco Bank and Central Bank of India-as part of their recapitalisation package. Of the total, Vijaya Bank got Rs700 crore, Uco Bank got Rs300 crore, Central Bank of India and United Bank of India received Rs250 crore each, sources said.

The letter to this effect was issued by the government on 2nd June.

These banks have been instructed to issue perpetual non-cumulative preference shares (PNCPS) in favour of the president, the recently listed United Bank of India had said in a statement. Accordingly, the bank has issued 25,000 PNCPS of Rs1 lakh each on June 4 in the name of the president, it had added.

The fund infusion will enable these banks to maintain comfortable level of capital to risk-weighted asset ratio for supporting credit requirement of the productive sectors.

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Bharat Forge, KPIT Cummins forms JV for hybrid technology

Bharat Forge Ltd said it formed a joint venture with KPIT Cummins Infosystems Ltd to manufacture and market an indigenously developed hybrid technology solution for automobiles - Revolo.

This will enable vehicles to increase fuel efficiency and engine performance, while significantly decrease green house gas (GHG) emissions. The technology has been designed and engineered by KPIT Cummins, while the solution for automobiles would be manufactured through a joint venture between Bharat Forge and KPIT Cummins, it said in a regulatory filing.

As part of the joint venture, KPIT Cummins will license the technology, while Bharat Forge would bring in its manufacturing, assembly and integration expertise. Revolo is an indigenous and innovative solution that has been conceptualised, developed and frugally engineered in India.

On Monday, Bharat Forge's shares fell 4.18% to Rs257 and KPIT ended 2.4% down at Rs108 on the Bombay Stock Exchange, while the benchmark Sensex ended 2% down at 16,781 points.

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KSK Energy Ventures signs PPA with GUVN for supply of 1,010 MW

KSK Energy Ventures Ltd, an Indian subsidiary of KSK Power Ventur Plc, said it  signed a power purchase agreement (PPA) with Gujarat Urja Vikas Nigam (GUVN) for long term supply of 1,010 MW from its power plant at Nariyara in  Chhattisgarh.

The PPA executed with GUVN is to be based on coal supplies from Gujarat Mineral Development Corp and its coal blocks.

On Monday, KSK Energy shares fell 3.67% at Rs170 on the Bombay Stock Exchange, while the benchmark Sensex closed 2% down at 16,781 points.

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