Public sector banks to get Rs14,000 cr to meet Basel III norms

Finance minister P Chidambaram said public sector banks (PSBs) will be provided with an infusion of Rs14,000 crore additional capital in 2013-14 budget estimates to enable them to meet the Basel III norms.

Of this, Rs12,517 crore infusion of capital into the 13 PSBs shall be done by March 2013.

He has taken steps in the budget to ensure adequate capitalisation of the public sector banks.

In order to achieve financial inclusion in addition to all scheduled commercial banks and rural regional banks, all the cooperative banks and other banks will now shift to core banking solution (CBS) by 31 March 2013.

All branches of PSBs in the country will have ATMs by the deadline of 31 March, 2014. In order to address gender related issues and empower women, India's first public sector Women's Bank will be set up with Rs.1000 crore as the initial capital.

This 'women's bank' will lend funds to women, women run businesses, women SHGs and will employ predominantly women and be functional from October 2013, he said.

Terming the financial sector as the heart of the economy, the finance minister announced constitution of a standing council of experts in the finance ministry to analyse the international competitiveness of the Indian financial sector.

The Financial Sector Legislative Reforms Commission will present its report next month, Chidambaram said, adding that the government's intention is to act quickly and decisively on the recommendations so that the financial system will stand on sound legal foundations.