Financial Services Secretary G S Sandhu on Friday ruled out higher fund allocation in the forthcoming budget to recapitalise state-owned banks.
"Not in this Budget. If there is any urgent requirement, the government is always there," Sandhu told reporters here today after attending the board meeting of the life Insurance Corporation of India.In the interim budget presented on February 17, the previous government had proposed to earmark `11,200 crore towards equity infusion in public sector banks, which have been facing severe asset quality pressure as bad loans continue to mount.Total non-performing assets (NPAs), or bad loans, of public sector banks stood at 4.4 per cent of advances at the end of March.
Union Finance Minister Arun Jaitley is set to present the Budget next month.The banking secretary said that there is no pressure from the Government on state-run banks to sell their non-core assets to raise capital.