Five Big Banks Like SBI, PNB, And BoB Considering A Stake Sale

Five big banks like SBI, PNB, and BoB considering stake sale, plan to increase the capital base. Five big state-run banks are considering selling shares to institutional investors during the second half of the current financial year ie September 2020-March 2021. These include large government lenders like SBI, BoB, Punjab National Bank (PNB) and Union Bank.

According to sources, these banks want to increase the capital base by selling shares amid the coronavirus crisis and the impact on the economy. Sources associated with merchant banking said that the route for institutional investors to raise capital may be the most accessible. Public sector banks can take a decision on this after finalizing the financial results in the second quarter.

According to sources, the picture of banks on stranded debt (NPA), debt restructuring, and ratings thereafter will be clear only by the end of October. He said that after that, banks can initiate procedures for time, quantity, the appointment of merchant bankers, and other formalities for the share sale.

According to sources, banks have planned to raise capital in such a way that there is enough scope for participation for both domestic and global investors. PNB has already expressed its intention to enter the capital market in the fourth quarter of the current financial year so that it can meet the growth requirements and regulatory requirements.

PNB Managing Director SS Mallikarjun Rao said in June that we are planning to raise capital in the third or fourth quarter of the current financial year. It is noteworthy that several private sector banks including ICICI Bank, Axis Bank, and Kotak Mahindra Bank have already raised capital in the last three months through institutional investors. Most public sector banks have already received approval from shareholders to raise capital through bonds and shares in the current financial year.

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