The Union Finance Minister, Mr Pranab Mukherjee, said the draft guidelines on Basel III, which were released on December 30, will be implemented in phases starting January 1, 2013 to 2019.

“The norms will be more stringent, besides envisaging capital requirements for banks,” said Mr Mukherjee, during the inauguration of Indian Bank's new corporate office in Chennai.

The Finance Minister said the government is committed to maintaining 8 per cent tier 1 capital adequacy ratio, above the RBI's norm of 6 per cent.

“The Government is committed to adequately capitalise all public sector banks. Extra provision under Basel III will be taken care of for 2012-13.

The government is committed to bringing our banks on par with global peers.”

Inaugurating Indian Bank's new 1.5 lakh sq ft corporate office building, Mr Mukherjee said the journey has just begun for the bank and it must “reach out to people at large.” Mr Mukherjee said financial inclusion is critical to development and to “overcome” the hindrances caused by money-lenders.

The 1.85 lakh sq ft Indian Bank corporate office is built in the trilobular shape, resembling the bank's logo.

It offers facilities such as e-lounge, WAP (Wireless Application Protocol)-enabled mobile banking and online application system for education and home loans.

Meeting credit needs

Dr K. C. Chakrabarty, Deputy Governor, Reserve Bank of India, said with a growing economy, banks must be able to meet the credit needs of people.

“Capital is not the problem for banks. Transition from Basel II to III is not a problem.

Meeting credit needs of society is important. We are a credit starved economy,” said Dr Charkrabarty, on the sidelines of the event.