diluting government equity banks are continuously in need of capital as for additional loans given by them they need to set aside funds while the all the deposits mopped up by them cannot be used for lending read also new work culture reduces govt interference in psbs the capital requirement of banks has also gone up due to rising bad debt or nonperforming loans requiring lenders to set aside more funds to cover for potential losses in future financial services secretary hasmukh adhia said the government has initiated a series of steps ranging from dealing with individual and sectoral problems to discussions with power distribution companies in some of the states to push for repayments in addition lenders have started talks with as part of the revamp instead of the earlier system of a statement of intent signed by bank managements the finance ministry now intends to measure performance on the basis of capital use diversification of business and processes npa management and financial inclusion marks would also be awarded for strategic initiatives to improve asset quality conserve capital hr initiatives and external credit rating adhia said