Allahabad Bank receives fresh capital of Rs 2,153 crore from government

State-owned Allahabad Bank on Thursday received a fresh capital infusion of Rs 2,153 crore from the government, said the company's BSE regulatory filing.

The Department of Financial Services in a letter on Thursday conveyed the sanction for the release of the fresh capital infusion fund of Rs 2,153 crore, the filing said.

The capital infusion is towards the contribution of the central government in the preferential allotment of equity shares of the bank during the financial year 2019-20 as the government's investment, it said.

Infusion of the capital into the bank by the government comes ahead of the merger with Indian Bank and it will help the bank meet the regulatory requirement to get amalgamated with a bigger peer.

Notably, Allahabad Bank had not featured in the list of banks who have approved a total fresh capital infusion of Rs 55,250 crore, as announced on August 30 by the government.

In this list, Punjab National Bank was approved to get Rs 16,000 crore, Union Bank of India Rs 11,700 crore, Canara Bank Rs 6,500 crore and Indian Bank Rs 2,500 crore.

Besides, Bank of Baroda got a capital infusion of Rs 7,000 crore, Indian Overseas Bank Rs 3,800 crore and Central Bank of India Rs 3,300 crore.

This round of capital infusion was intended to enhance the capital base of public sector banks so that they could accelerate lending in a bid to bolster growth.