The board of Punjab National Bank approved the Indian government's infusion of up to 180 billion rupees of capital into the public sector bank.
The bank will issue equity shares to the government on a preferential basis at a price to be determined, subject to shareholder approval, according to a Sept. 5 stock exchange filing.
The lender's board also granted in-principal approval to the government's plan to merge the bank with Oriental Bank of Commerce and United Bank of India and to commence the merger process, subject to necessary approvals.
The merger is part of the Indian government's plan to consolidate 10 public sector banks into four entities.
As of Sept. 5, US$1 was equivalent to 71.84 Indian rupees.
