OBC gets Rs 1,740 cr fund infusion from govt

State-owned Oriental Bank of Commerce (OBC) today said it has allotted 4.12 crore shares to the government of India on a preferential basis in return for a Rs 1,739.99 crore fund infusion.

As a result, the government of India's holding has increased to 58% from 51.09%, OBC said in a statement.

Shareholders of the bank approved a Special Resolution at an Extraordinary General Meeting yesterday for the issue and allotment of 4,12,21,482 equity shares of Rs 10 each to the government at Rs 422.11 per share, it said.

Finance Minister Pranab Mukherjee had announced a capital infusion of Rs 20,157 crore into public sector banks during the current fiscal to ensure that these entities were able to attain a minimum of 8% tier-I capital by March 31, 2011.

The proposed capital infusion is to enhance the lending capacity of the state-owned banks to meet the credit needs of the economy in order to maintain and accelerate the economic growth momentum.

Finance Minister Pranab Mukherjee in 2011-12 Budget presented last week had said, "I propose to provide a sum of Rs 6,000 crore for the year 2011-12 to enable Public Sector Banks to maintain a minimum tier-I Capital to Risk Weighted Asset Ratio (CRAR) at 8%."