Corporation Bank needs Rs.16 bn to meet Basel III norms
Kolkata, July 18 (IANS) Public sector Corporation Bank will require capital infusion of Rs.16 billion to meet Basel III capital adequacy norms for 2013-14, Chairman and Managing Director Ajai Kumar said Wednesday.
"Upto March, 2013 I am comfortable under Basel III. I will require Rs.1,600 crore capital for 2013-14 under severe conditions," Kumar told reporters on the sidelines of a FICCI event here.
Basel III capital regulation is aimed at improving the banking sector's ability to absorb shocks arising from financial and economic stress.
The Mangalore-headquartered bank's capital adequacy ratio currently stood at 12 percent.
Kumar said the bank would require some time to reduce its corporate bulk deposits to 10 percent of its total deposits for the current financial year as asked by the government.
"Ours (bulk deposits) is slightly higher. Our bulk deposits ranges close to 40 percent of the total deposits. It would be really difficult for me to come up to that (10 percent) level. I will require some time because the growth also has to happen," he said.
The finance ministry recently asked public sector banks to cap corporate bulk deposits at 10 percent of total deposits for the current financial year. Bulk deposits are usually term deposits above Rs.1 crore, with a maturity of less than a year.
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