The next week is going to be an important meeting of NITI Aayog officials, officials of Reserve Bank of India and Ministry of Finance on 14 April.
The government is moving fast in the direction of privatization of banks. According to the Business Standard report, the announcement of the name is possible next week. In Budget 2021, Finance Minister Nirmala Sitharaman had announced the privatization of two public sector banks and an insurance company. After this report, shares of NIFTY PSU Banks are seeing a rise of almost 3 percent today (1.20 pm).
The report said that on April 14 next week, an important meeting of NITI Aayog officials, officials of Reserve Bank of India and Ministry of Finance is going to be held. In this meeting, the names of those two banks will be decided, which will be privatized. NITI Aayog has suggested the names of 4-5 banks and it is believed that the names of any two will be decided in this meeting. Among these, the names of Bank of Maharashtra, Indian Overseas Bank and Central Bank of India are prominent. There is a bump in the stock of these banks.
It is being said that NITI Aayog has prepared a complete detail report keeping in mind the financial condition of these banks, the debt burden and some other aspects. Some banks are currently under the scope of Prompt Corrective Action (PCA) of the Reserve Bank. It is being said that the government will put money in these banks first and later either they will be privatized or will be included in other banks under merger.
Indian Overseas Bank, Central Bank of India and UCO Bank are currently under RBI’s PCA Framework. The government had recently announced to invest Rs 14,500 crore in four public sector banks. Of these, Rs 11,500 crore has been made available to the three banks while Rs 3,000 crore has been made available to the Bank of India. Capital of Rs 4,800 crore will be provided to Central Bank of India, Rs 4,100 crore to Indian Overseas Bank and Rs 2,600 crore to UCO Bank.
Please tell that the NITI Aayog has decided which banks will not be privatized. According to the NITI Aayog, apart from the State Bank of India, the banks which have been consolidated in the recent past will not be privatized. At present, there are 12 government banks in the country. Apart from SBI, Punjab National Bank, Union Bank, Canara Bank, Indian Bank and Bank of Baroda are not in the list of privatization based on the report.