Finance Ministry gives out a plan; to prevent failure of banks
Amid apprehensions over the safety of money in banks, the Union Finance Minister on Thursday spelt out a banking road map.
This is aimed at improving the functioning of public sector banks.
The issued new set of guidelines will mostly insist on rigorous due diligence, post-sanction follow-up on loans and separate asset management verticals to ensure public savings are untouched.
The Finance Ministry guidelines requires the Central government to infuse Rs 88,139 crore — of which Rs 8,139 crore is through budgetary allocation — into the banks by issuing recapitalization bonds this financial year.
This will be part of the recap boost for the lenders struggling with bad loans.
The finance ministry said it will not let any public bank to fail, assuring customers that their deposits will be safeguarded at all costs. >