New Delhi The government is considering the divestment of 5- 10 stake in public sector lenders in which it presently holds over 80 equity.
A detailed roadmap is anticipated to be concrete up soon, said people with knowledge of the matter. Government power exceeds 80 in six state- run banks- Bank of India, Indian Overseas Bank, Punjab & Sind Bank, Bank of Maharashtra, Central Bank of India and Uco Bank.
The stake trade can be conducted through the offer- for- trade route for lenders that aren’t inclined toward a rights issue, said people apprehensive of the reflections. In case banks need capital, also a follow- on public offer can be explored- the government will divest some stake and the lender will issue fresh equity in the same proportion.
” Banks will be submitting their capital- raising plans, and grounded on those assessments, a roadmap permata55 may be drawn up for each lender,” said an functionary, adding that the timing of these issues will depend on request conditions and could unmask over to the coming financial time.
In the once time, the Nifty PSU Bank indicator has yielded 34 against a6.9 rise in the Nifty Private Bank Index. The standard Nifty 50 was over6.4 over this period. On Monday, the Nifty PSU Bank indicator rose2.64, as the Nifty 50 dropped 82 points, or0.42, to close at 19,443.55.
A 10 stake trade in the Bank of India, the biggest of the six, can cost nearly Rs 4,400 crore at current request value. The government owns81.4 in the bank.
Privatisation on Course
The privatisation plans of the two state- run banks linked for this exercise will continue in resemblant and won’t be impacted by these small stake deals, said another functionary.” The privatisation plan for two PSBs can still be pursued if the government holding comes down by 5- 10( chance points). There’s no conflict between the two,” said another functionary.
The government is also looking to exit from IDBI Bank, now categorised as a private sector lender.
Finance minister Nirmala Sitharaman had blazoned the privatisation of two state- run banks as part of the government’s disinvestment programme in her February 2021 budget speech. latterly, in April 2021, Niti Aayog recommended the privatisation of two state- run banks to the disinvestment department. The Central Bank of India and Indian Overseas Bank were reportedly shortlisted, but no f.