The MD of Punjab and Sind Bank said there was no need for any capital assistance from the government this year.

The Punjab and Sindhu Bank governments will no longer need more capital to meet the growth demand in the current financial year, the bank’s top official said.

In the previous two years, the government had deposited Rs 5,500 crore and Rs 4,600 crore through non-interest bearing recap bonds.

With a charge of Rs 4,600 crore, the government’s holdings in banks have increased by 98.25 per cent till March 31, 2022.

The bank’s capital adequacy ratio has increased from 17.06 per cent in March 2022 to 18.54 per cent with the help of government capital support at the end of March 2021, said S Krishnan, MD and CEO of the bank.

The bank has sufficient capital to meet the expected credit growth this financial year and may not need assistance from the government, he said.

As far as debt growth is concerned, he said, it is expected to grow at 8-10 per cent in FY23. He further said that the bank has strengthened its balance sheet by making additional provisions and it has actively provided 100 per cent provision for all frauds.

The state-owned bank did not seek any allocation from the Reserve Bank to suspend the provision.

The bank last month declared Rs 510.16 crore as arrears to Srei Infrastructure Finance and Rs 724.18 crore as arrears to Srei Equipment Finance Ltd.

In October last year, the RBI dismissed the board of directors of two Srei Group firms and appointed an administrator due to administrative problems and errors in payment obligations.

It has initiated a corporate bankruptcy proceedings against both companies. According to some estimates, Srei has about Rs 28,000 crore in bank exposure and another Rs 18,000 crore in bondholders.

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