Government may plan minority stake sale in four PSU banks

The Indian government is considering selling minority stakes in four state-run banks to comply with public shareholding norms mandated by the country's markets regulator, as per a government source. The finance ministry is likely to seek approval of the federal cabinet in the coming months to dilute the stake in the Central Bank of India, Indian Overseas Bank, UCO Bank, and Punjab and Sind Bank, the source said.

As of September, the Indian government holds significant ownership stakes in several public sector banks: over 93% in the Central Bank of India, 96.4% in Indian Overseas Bank, 95.4% in UCO Bank, and 98.3% in Punjab and Sind Bank, according to data from the BSE's website.

The government is currently considering selling a portion of its stake through an offer for sale in the open market. In the past, public sector banks have utilized qualified institutional placements (QIPs) to raise capital, which has resulted in a reduction of the government's stake in these state-run banks.

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