The Piramal Group, which owns a non-bank financier, is weighing acquisitions to enter the banking space and may look at public sector banks (PSBs) that the government puts on the block, group chairman Ajay Piramal said. “We’ll look at opportunities as and when they come. We’ll see,” Piramal said in an interview.
Possible targets could be IDBI Bank Ltd and a couple of other state-run banks. “Well, IDBI has been going on for years. Nothing has happened. So, obviously, there’s no interest now. They want to change the terms. So, we’ll see. I can’t say anything categorical today. Let’s see what the opportunities are,” he added.
Piramal did not participate in IDBI Bank’s divestment process, which was put on hold in November and is likely to restart only in the second half of next year. The government, which owns 45.48% of the bank, and Life Insurance Corp. of India, which holds 49.24%, together plan to sell 60.7% of the lender.
Bank Privatization
A senior government official has indicated that the eagerly anticipated privatization of public sector banks (PSBs) is unlikely to take place before the 2024 general elections. The official, who requested anonymity, stated, “Nothing will transpire before the 2024 general elections. The absence of necessary legislation is a hindrance; without it, privatization cannot proceed.”
The official explained that amendments to the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, and the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980, are essential for the privatization process. These acts, pivotal in the nationalization of banks in two phases, require modifications to facilitate privatization.
India is currently home to 12 public sector banks: Bank of Baroda, Bank of India, Bank of Maharashtra, Canara Bank, Central Bank of India, Indian Bank, Indian Overseas Bank, Punjab & Sind Bank, Punjab National Bank, State Bank of India, UCO Bank, and Union Bank of India.
