We keep hearing clarion calls for more and more government funding for recapitalization of our public sector banks. Clearly, more recapitalization with government funds is essential. However, as a majority shareholder of public sector banks, the government runs the risk of ending up paying for it all.
The expectation of government dole outs might have been set 5/7  BIS central bankers' speeches  by the past practice of throwing more money after the bad. Take for instance our bank recapitalization plan of 2008–09 after the global financial crisis: banks that experienced the worst outcomes received the most capital in a relative sense. Most of these banks need capital again.