Bank of Maharashtra to Reduce Government Stake

The Bank of Maharashtra is planning to raise at least ₹2,000 crore during the current financial year. The money will be raised either through a Qualified Institutional Placement (QIP) or an Offer for Sale (OFS), according to the bank’s Chief Executive Officer, Nidhu Saxena.

The main purpose of this move is to reduce the government’s stake in the bank to 75% or below, in line with market rules. Currently, the government owns 79.6% of the bank.

Why is the Share Sale Important?

1. SEBI Rules – The Securities and Exchange Board of India (SEBI) requires all listed companies to have at least 25% public shareholding. This means the promoter (in this case, the government) can hold a maximum of 75%.
2. Capital Needs – Apart from reducing government ownership, the fundraising will also help the bank maintain a strong capital adequacy ratio, which is important for supporting future business and loan growth.

CEO’s Statement

Bank of Maharashtra MD&CEO said that, based on the bank’s current share price, ₹2,000 crore should be enough to meet SEBI’s shareholding rules. He also mentioned that the bank is considering different options, including an OFS, and that the Department of Investment and Public Asset Management (DIPAM) has already started some processes in this regard.

Government’s Divestment Plan

This stake sale is part of the government’s broader plan to reduce its shareholding in five state-owned banks. The deadline to meet SEBI’s minimum public shareholding norm is August 1, 2026.

The Government of India is planning to reduce stake in 5 Public Sector Banks:

• Bank of Maharashtra
• Indian Overseas Bank (IOB)
• UCO Bank
• Central Bank of India
• Punjab and Sind Bank

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