Page 6 - BF Cover February 2019

BANK UPDATE

Govt to infuse Rs 28,615 cr in 7 PSBs soon ICICI Bank and SBFC join

The government is likely to infuse Rs 28,615 crore into seven public sector banks hands to lend to SME's
(PSBs) through recapitalisation bonds sources said. Out of these seven PSBs, Bank
of India is likely to get the highest amount of Rs ICICI Bank and Small Business
10,086 crore, followed by Oriental Bank of Com- FinCredit will jointly provide loans
merce, which might get Rs 5,500 crore through worth up to
recapitalisation bonds, sources added. Rs 1 crore to
the Small
Other banks that are likely to receive capital infu-
sion in this round included Bank of Maharashtra and Medium
Enterprises.
which may get Rs 4,498 crore, UCO Bank (Rs 3,056 crore) and United Bank of
India (Rs 2,159 crore). The government had earlier announced an infusion of Rs ICICI Bank
65,000 crore in PSBs in 2018-19, of which Rs 23,000 crore has already been said it has signed a memorandum of
disbursed, while Rs 42,000 crore is remaining. understanding with Small Business

NPAs of Public sector banks decline by over 23,000 crore FinCredit India Pvt Ltd (SBFC) to
jointly provide credit to micro, small
The bad loans of public sector banks have declined by over Rs 23,000 crore and medium enterprises (MSMEs).
from a peak of Rs 9.62 lakh crore in March 2018, said a senior finance ministry
official. At the same time, public sector banks (PSBs) have also made a record in The partnership has been forged
recovery of Rs 60,726 crore in the first half of the current financial year, which under the aegis of RBI's circular
is more than double the amount recovered in the corresponding period last year. dated September 21, 2018, that per-
According to the latest finance ministry data, non-NPA accounts overdue by 31 mits banks to engage with a non-
to 90 days (Special Mention Accounts 1 & 2) of PSBs have declined by 61 per banking financial company (NBFC) to
cent over five successive quarters - from Rs. 2.25 lakh crore as of June 2017 to co-originate loans for the creation of
Rs 0.87 lakh crore in September 2018. priority sector assets, the bank said.

New executive director of Allahabad Bank
It is the first-of-its-kind programme
Mr S S Mallikarjuna Rao has joined as Managing Director by a bank and an NBFC, it said, add-
and Chief Executive Officer of Allahabad Bank, one of the ing the loans of up to Rs 1 crore is
premier nationalised banks of the country. Prior to joining for tenure of 15 years per customer.
the bank, he served as Executive Director of Syndicate Bank.
Under this arrangement, ICICI Bank
He has been a professional banker for over 33 years and held
will co-originate loan against prop-
position as General Manager & CFO in Oriental Bank of Com-
merce and also as Assistant Vice-President in erstwhile Glo- erty with SBFC at a mutually agreed
bal Trust Bank. He started his career in 1985 as a Probationary Officer in Bank ratio.
of Maharashtra and headed various positions thereat. The flow of funds from ICICI Bank will
IBC helped creditors recover Rs 80,000 crore to date help customers aid their businesses
Insolvency and Bankruptcy Code (IBC) has helped lenders get Rs 80,000 crore in in a seamless manner.
66 cases and another about Rs 70,000 crore is likely to be recovered in the "This is a first of its kind lending ar-
remaining months of the current financial year Finance Minister, Arun Jaitley
said. rangement... With this initiative, we
aim to support the entrepreneurial
Jaitley said National Company Law Tribunal (NCLT) had started receiving corpo- aspirations of customers who can
rate insolvency cases by the end of 2016 and so far, 1,322 cases have been
contribute to the infrastructure
admitted by it. A total of 4,452 cases have been disposed of at pre-admission growth story of the country," said
stage and 66 have been resolved after adjudication. As many as 260 cases have Ravi Narayanan, Head - Secured As-
been ordered for liquidation, he said in the post, titled two years of Insolvency sets, ICICI Bank.
and Bankruptcy Code (IBC).

6 | 2019 | FEBRUARY | BANKING FINANCE