BoM expects Rs 1,800 cr fund infusion from Govt

State-owned Bank of Maharashtra hopes to get from the government around Rs 1,800 crore, which would help the lender augment its equity capital base, a top bank official said.

"We hope to get Rs 1,800 crore from the budget provision. The infusion is likely to happen by way of preferential share issue," BoM Chairman and Managing Director  Allen C Pereira told PTI here.

The government, which currently holds just above 76 per cent stake in the bank, is likely to infuse this capital in different tranches, Pereira said.

Announcing the Budget, Finance Minister Pranab Mukherjee had promised Rs 16,500-crore capital infusion in state-run banks to help them maintain a minimum Tier-I capital adequacy ratio of eight per cent.

Other banks, which are likely to receive the funds from the Budget package include Dena Bank, Punjab and Sindh Bank, Oriental Bank of Commerce and Andhra Bank among others.

As on date, BoM has Tier I capital adequacy ratio of 6.11 per cent, which is likely to go up to around 7-8 per cent post infusion.

Subsequently, the overall capital adequacy ratio of the bank, which is at 12.11 per cent, will cross 13 per cent, Pereira said.

BoM has a total business of Rs 96,000 crore and its advance-book is around Rs 38,000 crore.