The Indian government is considering reducing its stake in four public sector banks to 75% to comply with minimum public shareholding norms, according to a report in the Economic Times on Friday.
The four banks identified are Central Bank of India, UCO Bank, Punjab & Sind Bank, and Indian Overseas Bank. This move is part of the government's efforts to reform the banking sector and increase private sector participation.
Furthermore, the report indicates that the government is preparing for another round of consolidation among state-owned lenders, which could see two more banks identified for privatization.
These plans follow the 2021-22 Budget announcement, where the government stated its intention to privatize two public sector banks and one general insurance company, in addition to IDBI Bank.
Earlier this month, the government announced that Fairfax Financial Holdings, promoted by Canadian billionaire Prem Watsa, would acquire a 60.72% stake in IDBI Bank for ₹52,878 crore.
These actions signal the Indian government's commitment to reducing its role in the financial sector and handing over the management of these institutions to the private sector to enhance efficiency and competition.
Source: Economic Times
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