New Delhi: Public Sector Banks (PSBs) can now increase capital while issuing preference shares, rights issues or bonus shares without being limited by the earlier ceiling of Rs 3,000 crore, the Finance Ministry said on Friday.
The restriction has been removed following passage of the Banking Laws (Amendment) Bill 2012 in Parliament. The Bill will become a law after its is signed by the President.
The Ministry said the Bill will strengthen the regulatory powers of the Reserve Bank and further develop the banking sector in India. “It will also enable nationalised banks to raise capital by issue of preference shares or rights issue or issue of bonus shares.
“It would also enable them to increase or decrease the authorised capital with approval from the Government and RBI without being limited by the ceiling of a maximum of Rs 3,000 crore,” the ministry added.