The government would make a capital infusion of over Rs 1,000 crore in three public sector banks including UCO Bank and Central Bank of India this month.

Central Bank of India, UCO Bank and United Bank of India would get Rs 1,200 crore from the government to meet their capital requirement.

This fund infusion will enable these banks to maintain comfortable level of capital to risk-weighted asset ratio (CRAR) for supporting the credit requirement of the productive sectors of the economy.

Of the total, UCO Bank and Central Bank of India would get Rs 450 crore each while United Bank of India, which recently went for an initial public offer, would get financial assistance of Rs 300 crore, according to the supplementary demands of grant tabled in Parliament recently.

Last fiscal (2008-09), the government infused Rs 1,900 crore as Tier-I capital in four public sector banks namely Cntral Bank of India, UCO Bank, Vijaya Bank and United Bank of India to maintain a comfortable level of capital to Risk Weighted Asset Ratio.

Under the Tier-I provision, banks can raise capital as equity and innovative instruments like perpetual non-cumulative preference shares and perpetual bonds.