PTI

New Delhi, Feb 11: The government has announced a Rs 3,800-crore fund infusion into state-run lenders — UCO Bank, Central Bank of India and Vijaya Bank — to shore up their capital adequacy.

Under the recapitalisation package, Central Bank of India will get Rs 1,400 crore, while UCO Bank and Vijaya Bank will get Rs 1,200 crore each, home minister P Chidambaram told reporters after the cabinet meeting here.

The capital infusion will be done in two tranches, he said, adding that the first tranche will be made available during the current fiscal and the remaining in 2009-10.

As part of the first tranche, UCO Bank will get Rs 450 crore, while Central Bank of India and Vijaya Bank will get Rs 700 and Rs 500 crore, respectively, in the current fiscal.

Spelling out the reason for the capital infusion, Chidambaram said, this will help banks raise capital adequacy over 12 per cent much above the Basel II norms of 9 per cent.

In the next tranche, UCO Bank will get Rs 750 crore, while Central Bank of India and Vijaya Bank to get Rs 700 crore each, he said.

The amount will be form a part of Tier I Capital, he said, adding the infusion will increase the government holding in the three state-run banks.