India's laggard state lenders face tough sell on capital-raising plan

Mumbai

INDIA'S state-run banks face major obstacles in their plans to raise as much as US$60 billion in new capital over the next few years, with investors sceptical about the prospects for most of them and workers wary of the government's grip loosening.

With the tailwind of a strong recent stockmarket performance on optimism about a new government led by Prime Minister Narendra Modi, the banks are preparing to raise capital to meet upcoming global regulations and to build a buffer against rising bad loans. Banks such as State Bank of India (SBI) have appointed advisers for share sales.