Money & Banking

Govt to infuse Rs 775 cr into Bank of Baroda: Mallya

PTI Mumbai | Updated on December 26, 2011 Published on December 26, 2011

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The government has agreed to infuse Rs 775 crore into the third largest state-run lender Bank of Baroda, a top official of the bank said on Monday.

“As part of increasing its stake to the mandated 58 percent, the government has agreed to pump in Rs 775 crore into our bank. The fund infusion will happen before the end of the fiscal,” Bank of Baroda chairman and managing director Mr M D Mallya told PTI. This could be done by a preferential allotment, he added.

In March this year, the government had pumped in Rs 2,675 crore, thereby increasing its stake to 57.3 percent from 53 percent earlier, Mr Mallya said, adding with the infusion of Rs 775 crore, the government ownership in the bank will touch the mandated 58 percent.

The development comes even as there is no commitment to the over-a-year-old demand from the nation’s largest lender State Bank of India for capital infusion to meet the mandatory core capital requirement and also fund expansion.

The latest on this request, according SBI chairman, Mr Pratip Chaudhuri, is that government may infuse Rs 3,000-4,000 crore by the end of the year.

SBI has been seeking the government nod to go in for a Rs 20,000 crore rights issue since the beginning of fourth quarter of the past fiscal, but a cash—strapped government has not given its permission as it would have to buy nearly two— thirds of the issue.

The BoB counter closed 0.43 percent up today on the BSE at Rs 678.75, while the main index Sensex rallied 1.47 percent or 230 points.

Published on December 26, 2011
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