Business Daily from THE HINDU group of publications
Saturday, Dec 09, 2006

Cross Currency

Group Sites

Home Page - Financial Policy
Money & Banking - Public Sector Banks
Markets - Stocks
Get Latest BSE Quote
Govt will stand by SBI's capital-raising efforts

Our Bureau

`Stake in PSBs will not be below 51 pc'


New Delhi , Dec 8

The Finance Minister, Mr P. Chidambaram, on Friday said that the transfer of Reserve Bank of India (RBI) shareholding in State Bank of India to the Government would not in any way adversely impact the bank's capital-raising ability.

He told the Lok Sabha that the Government had agreed in principle to acquire the RBI's shareholding in SBI and was close to reaching a final decision on the transaction. Currently, the RBI holds 59.73 per cent stake in SBI.

"SBI has a comfortable capital adequacy of 12.63 per cent, as on September 30, well above the minimum regulatory environment of nine per cent. The apprehension that the transfer would impair fresh capital-raising is unfounded," Mr Chidambaram said. He also said that the Government would fully stand by SBI in its efforts to raise more capital.

The bank has a number of avenues, irrespective of ownership, to strengthen its capital - raising fresh equity, issue of innovative perpetual debt instruments eligible for inclusion as tier-I capital, issue of various capital instruments to shore up tier II capital, etc.

The Finance Minister also said that the Government would retain majority shareholding of at least 51 per cent in SBI whenever the transfer would happen.

The Government would continue to hold 51 per cent and above shareholding in all public sector banks and there was no question of bringing any legislation to allow Government shareholding to go below that level.

More Stories on : Financial Policy | Public Sector Banks | Stocks | State Bank of India

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page


Stories in this Section
Rains may lash TN coast from Sunday

Fast food MNCs take Indian recipes overseas
US offshoring tax returns preparation to desi accountants
GSM base crosses 100-m mark
Lower food, energy prices peg down inflation
RBI hikes cash reserve ratio to 5.5 pc
ICICI Lombard plans biometric health cards
Changi seeks to bid for airport modernisation
For pharma, biotech firms, all roads lead to Europe
Lifan, M&M in talks for 2-wheeler venture
Oracle ups open offer price, size for i-flex Solutions
`Top three vendors at strategy crossroads'
Oracle's open offer for i-flex: Regulatory angle
Govt will stand by SBI's capital-raising efforts
Sensex sheds 173 points
Bajaj Auto: Betting on new moves
Tata Tea turns active
ICICI Bank board to take up Sangli Bank merger today
Govt promises to reallocate shares to IPO scam victims

The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription
Group Sites: The Hindu | The Hindu ePaper | Business Line | Business Line ePaper | Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |

Copyright 2006, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line