Employees, Markets Curious as Top Officials Meet to Decide on Privatisation of 2 Public Sector Banks Today

The Centre, in a meeting of top officials on Wednesday, will zero in on privatisation of two public sector banks. Senior members of the Niti Aayog, RBI and the finance ministry’s financial services and economic affairs departments will be discussing the potential candidates for privatisation

NITI Aayog had last month submitted its first list of PSBs. The names for privatisation on Wednesday could include Bank of Maharashtra and Indian Overseas Bank.

The list was first reviewed by the Department of Investment and Public Asset Management (DIPAM), and the Core Group of Secretaries on Divestment (CGD), headed by the cabinet secretary.

This comes after the government’s ambitious drive to privatise PSUs, as announced by Finance Minister Nirmala Sitharaman in Budget 2021. This would clear the way for the Centre to go ahead with its Rs 1.75 lakh crore disinvestment target for the next financial year.

Sitharaman, in her Budget speech, had announced privatising two PSBs and one general insurance company in 2021-22.

As per the new PSE (Public Sector Enterprise) policy for Aatmanirbhar Bharat, NITI Aayog is entrusted with the task to suggest the names of PSUs in strategic sectors to be merged, privatised, or made subsidiaries of other PSUs.

Shares of public sector banks were on a roll after news of privatisation.

At the bourses, shares of Bank of Maharashtra skyrocketed 15.3 per cent on the National Stock Exchange (NSE), Indian Overseas Bank surged 12 per cent, and Central Bank of India jumped 10 per cent.

Other PSB stocks, including Punjab and Sind Bank, Bank of Baroda, Indian Bank, UCO Bank, and J&K Bank gained between 7.5 per cent and 12 per cent on the NSE while Canara Bank, Bank of Baroda, PNB, Union Bank of India, and

State Bank of India (SBI) rallied up to 3 per cent. In comparison, the Nifty PSU Bank index rose 4.7 per cent in the intra0day trade while the Nifty50 index added 0.2 per cent.

The Aayog is learnt to have prepared a report on PSBs based on their financials, debt and other issues, and accordingly short-listed them

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