"The banks have also presented various options to raise capital. All these measures will be a part of the presentation," the official said. Some of these options provided by the banks include setting up investment companies that will include all their subsidiaries and this investment company will raise money on behalf of these subsidiaries. Other measures include focusing special purpose vehicles and raising capital by allowing banks to issue shares to employees. Among all these proposals some of them are already being discussed with the Reserve Bank of India, the Securities and Exchange Board of India and the Insurance Regulatory and Developmental Authority, said the official cited above.

All the banks have been directed to work towards their Current and Savings accounts Ratio and make it up to 40 percent and also they are told to focus on recoveries by the finance ministry. It seems that the Gross non-performing assets of state-run banks improved to 4.44 percent in the quarter to March from 5.07 percent in the previous quarter.

"We will push for stricter measures which include attaching viable assets of promoters to recover loans," said the finance ministry official, signaling the continuation of the approach that founders be held accountable for the performance of companies they run.