Punjab Sind Bank does not need additional capital injection, says CEO

Punjab Sind Bank does not need additional capital injection, says CEO

The top official of the bank said that Punjab Sind Bank would not need additional capital injection from the government to meet growth needs during the current fiscal year. During the two previous years, the government injected Rs 5,500 crore and Rs 4,600 crore through non-interest bearing bonds.

The government holding in the bank increased to 98.25 per cent as of March 31, 2022 with the infusion of Rs 4,600 crore.

With the help of capital support from the government, the bank's MD and CEO S Krishnan said that the bank's capital adequacy ratio increased to 18.54 per cent in March 2022, from 17.06 per cent at March-end 2021.

He said that the bank is sufficiently capitalised to meet expected credit growth in the financial year and may not need support from the government.

As far as loan growth is concerned, he said it is expected to grow at 8 -- 10 per cent in FY 23. He said the bank strengthened its balance sheet by making additional provisions and it has made 100 per cent provisions in all fraud cases.

The state-owned bank has not sought any dispensation from the Reserve Bank for staggering the provision.

The bank declared Srei Infrastructure Finance with outstanding debts of Rs 510.16 crore and Srei Equipment Finance Ltd with outstanding debts of Rs 724.18 crore accounts as fraud.

In October of last year, the RBI had appointed an administrator and replaced the board of directors of the two Srei group firms, due to governance issues and default in payment obligations.

It initiated a corporate insolvency resolution process against both companies. According to some estimates, banks have about 28,000 crore exposure to Srei and bondholders another Rs 18,000 crore.