India’s second-largest state-owned lender Punjab National Bank (PNB) on Monday said it did not envisage approaching the Centre for capital support; rather, it intends to raise funds from the market, which seems to have an appetite for the public sector banking space.
The bank has shareholders’ approval for raising ₹14,000 crore, including ₹7,000 crore in equity, from the market to meet COVID-19-related impact and finance growth, PNB MD S.S. Mallikarjuna Rao said.
“As on today, it does not appear [the need to approach government for capital]. If you look at market appetite also, there is intent to contribute to public sector space,” he said.
₹40,000-cr. loan recast
PNB also said it expects to restructure loans worth about ₹40,000 crore as per RBI-approved guidelines, scheduled to be out soon.
“Our total loan book is ₹7.21 lakh crore at June end. A rough estimate that we are seeing is that anything around 5-6% of the credit book may be eligible under the restructuring profile.
“This 5-6% comes to about ₹40,000 crore. Major composition of this, of about 50%, would be corporate books,” Mr. Rao said.