Government moving Forward for Divestment in PSU Banks

The Indian government is moving ahead in completing the stake sale in IDBI Bank before the end of the current financial year, according to Financial Services Secretary M. Nagaraju.

Speaking at the Global Fintech Fest in Mumbai, Nagaraju also confirmed that the government is also planning for divestments in other state-run banks through offer-for-sale mechanisms within the same timeframe.

He said that the sale process is progressing as planned and will be completed before the fiscal year ends.

Earlier, the government had stated that due diligence for the IDBI Bank stake sale had been completed, and it intends to invite financial bids between October and December.

Currently, the government holds a 45.48% stake in IDBI Bank, while state-owned Life Insurance Corporation of India owns 49.24%. Together, they plan to sell a 60.7% stake in the lender. The disinvestment process was first announced in 2022.

In addition to IDBI Bank, the government also plans to offload up to 20% of its stake in five public sector banks over the next four years.

The five banks targeted for phased disinvestment are Bank of Maharashtra, Indian Overseas Bank, UCO Bank, Central Bank of India, and Punjab and Sind Bank. In each of these institutions, the government plans to gradually reduce its stake to below 75%.