The government announced on Wednesday that it will be deciding very soon whether to infuse Rs. 16,500 crore in the public sector banks (PSBs). A private media agency, PTI, has reported that something will surely come up by the end of April.

The state-run banks need fresh capital to be able to get recapitalized. And the government is hell-bent that it will decide on something by the end of next month, said R Gopalan, the Financial Services Secretary. He was talking on the sidelines of an event organized by FICCI.

He said that the government is looking at credit flow of the various PSBs and the assessment will be over by March end. After that the Capital to Risk (Weighted) Assets Ratio (CRAR) and tier I capital, will also be considered, before taking any final decision.

These plans are in accordance with what the Finance Minister had told during the budget. He had said that an additional Rs. 1,200 crore is getting injected immediately and there is a proposal to infuse another Rs16,500 crore, to attain at least 8 per cent tier-I capital.

It is expected that the regional rural banks will benefit the most from this.