Bank of Baroda will receive Rs 5,042 crore fund infusion from the government ahead of its merged entity operation.
The Ministry of Finance has conveyed its decision to infuse the capital in Bank of Baroda. The infusion will be by way of preferential allotment of equity shares (special securities/bonds) of the bank during FY 2018-19 as government’s investment, the bank said on Thursday.
Officials said this will help the bank meet credit and contingency needs. The merged entity also involving Vijaya Bank and Dena Bank will start operation from April 1.
Meanwhile, the Supreme Court refused to stay the amalgamation of Vijaya Bank, Dena Bank and Bank of Baroda, rejecting a plea from the Bank Officers Association. The stock hit an intraday high of Rs 123.45 and intraday low of Rs 120.4. The net turnover during the day was Rs 11.64 crore.
In February, the government approved Rs 48,239 crore recap bonds in 12 public sector banks. The merger will create India’s third largest bank with a total business of over Rs 14.82 lakh crore.