RBI governor showers praises on bank recapitalisation plan

Patel said "a well-capitalized banking, and in general, financial intermediation, system is a pre-requisite for stable economic growth."

In an unusual communique, Reserve Bank of India (RBI) governor Urjit Patel, who in the past had stressed on an urgent need for capital infusion in banks while sharing the same dais with finance minister Arun Jaitley, termed the latest recapitalisation plan as a “monumental step forward in safeguarding the country’s economic future.”

The finance ministry on Tuesday said it will infuse Rs 2.11 lakh crore in government banks over two years through recapitalisation bonds and market borrowings. The recapitalisation bonds worth Rs 1.35 lakh crore won’t hit the market while some of the provisions for other means of capitalization