Indian Overseas Bank, Central Bank of India Can Be Privatised Soon? This Is What We Know So Far..

As per some latest reports, the government of India has now started inviting bids from many companies for their privatization.

Additionally, the process of privatization of PSBs is also on the verge of beginning, despite the strikes being held against it. 

Government To Remove 20 Percent Cap On Foreign Ownership

As per reports, the government will probably remove the 20 percent cap on foreign ownership in PSU banks (PSBs) which will be done by amending the Banking Regulation Act. As per some sources, two public sector banks have also been shortlisted for privatization. 

Whereas, some media reports have confirmed that these major changes may take some time, as revealed by a few government officials. 

Some government officials have confirmed that the Indian Overseas Bank and Central Bank of India are the two candidates who can be privatized. Additionally, the Bank of Maharashtra is also on the list. 

In February this year, we reported that the government has yet not decided on public sector banks’ privatization, according to the Minister of State for Finance Bhagwat Karad as he informed Parliament.

Bank of Maharashtra And Indian Overseas Bank To Be Privatized?

During Budget 2021-22, the government announced its intent to privatize two public sector banks (PSBs) during the year. 

Banks need to be privatized because if they’re not, the organizations won’t change fast enough and may become obsolete, or will not have sufficient capital to sustain the business.

In the Union Budget meeting on February 1, FM Nirmala Sitharaman announced the government’s plan to conduct the privatization of two more public sector banks, besides IDBI Bank, along with one general insurance company, in the financial year FY22 (2021-2022).

The privatization process will be a part of the government’s disinvestment drive of Rs 1.75 lakh crore.

The two public banks known to be shortlisted for privatization are Bank of Maharashtra and the Indian Overseas Bank.

The government’s 52.98% stake in the state-run oil retailer, BPCL, is on sale and initial bids have already been received. One of those bids came from billionaire Anil Agarwal-led Vedanta Group.