Centre likely to sell stake in Indian Overseas Bank, Central Bank

New Delhi, June 07: The Centre is likely to sell its stake in the Central Bank of India and Indian Overseas Bank as part of its privatisation initiative, which was revealed in the Union Budget 2021.

Reports say that Niti Aayog has submitted the names of two public sector banks, which can be sold off under the government's new privatisation policy. The Department of Investment and Public Asset Management (DIPAM), and the Department of Financial Services will examine the names and finalise the list of possible candidates in the financial sector for privatisation this year.

Before the plan is finalised, the government will also consult with RBI as the law and regulations provide a special dispensation for state run entities in several areas. It may be recalled that the Cabinet had recently cleared the decks for the sale of the government's stake in the IDBI Bank.

The government is hopeful of concluding the sale of IDBI Bank's stake in the current financial year. The Niti Aayog had set its eyes on six entities namely Bank of Maharashtra, Punjab & Sind Bank and UCO Bank in addition to BoI, IOB and Central Bank.

It was of the view that better off entities would attract greater interest which would result in shortlisting of IOB and Central Bank. The two entities are valued at Rs 44,000 crore based on the current share price.