The recapitalisation programme for public sector banks is likely to boost equity market sentiment as it fuels growth recovery hopes, but should be followed up with structural changes at such banks for better results, says a UBS report.
According to the global financial services major, though the recapitalisation amount may create a supportive environment for growth, it may not drive growth by itself.
The Centre on October 24, unveiled a ₹2.11-lakh crore two-year roadmap to strengthen NPA-hit public sector banks, which includes re-capitalisation bonds, budgetary support and equity dilution.