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8 billion capital injection over the next four years as part of a restructuring program that will keep full ownership with the State.
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People's Bank is to receive a Rs. 8 billion capital injection over the next four years as part of a restructuring program that will keep full ownership with the State. This is the third time the State banking giant plagued by huge non-performing political loans is receiving a capital injection.
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Rs. 2 billion in equity will be made available to the bank this year that has a Rs.
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10 billion capital shortfall in its balance sheet.
People's Bank has a number of militant unions that once prevented senior management from entering the bank. The unions say they are worried the restructuring will lead to privatisation.
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The bank was re-capitalized twice in 1993 and 1996 when up to Rs. 17 billion rupees worth of reconstruction bonds were issues.
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The latest attempt is different because it is a cash injection and supported by a program loan from the Asian Development Bank (ADB).
ADB will lend US$ 65 million to the government for a private sector development program most of which is in support