Of the Rs 1 trillion of additional capital, the fund-starved public sector banks alone would need Rs 93,000 crore. Banks may need an additional Rs 1 trillion in fresh capital over and above their Basel-III requirements if RBI goes ahead with its proposal to create a ceiling on bank borrowing by large corporates, says a report. The agency believes that the Bankruptcy Code will take some time before it starts to offer any tailwind to the corporate bond market. Of the Rs 1 trillion of additional capital, the fund-starved public sector banks alone would need Rs 93,000 crore, India Ratings director and co-head for financial institutions Abhishek Bhattacharya said in the note. But for a meaningful deepening of the corporate bond markets, multiple enablers will be needed so as to improve the appetite of domestic institutional investors.

Source: dna May 16, 2016 11:22 UTC