In a statement filed at Bombay Stock Exchange, Punjab National Bank (PNB) said it approved the issuance of preferential shares worth Rs 1,250 crore to the central government.
Accordingly, the state-run bank would issue preference shares with face value of Rs 10 each. The proposed preferential allotment will be subject to necessary approvals and the price for issue would be decided by as per market regulator SEBI rules, it said.
On March 4, shareholders would vote on the proposal at an extraordinary general meeting. Last year, PNB got capital infusion of Rs 1,285 crore from the government.
Recently, the government approved infusion of Rs 12,517 crore in around 10 state-owned banks over the next three months.
The finance ministry said that about 9-10 banks would get the capital and this would enable them to maintain the Tier I CRAR (capital to risk-weighted assets ratio) at a comfortable level. This would help the recepient banks meet the stricter capital adequacy norms of Basel III whenever it is implemented.
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