The shares of several public sector banks (PSB) rose on September 11, pushing the Nifty PSU Bank index higher into the green in the afternoon. This comes as reports on further consolidation of these lenders boosted investor sentiment.
The Nifty PSU Bank index rose nearly 1 percent to 7,089, extending gains for the second consecutive session.
The government is expected to revisit the consolidation plans of these PSBs in an effort to create larger and more globally competitive lenders, The Economic Times reported on September 10, citing sources. The issue will be taken up at the upcoming PSB Manthan which is scheduled to begin tomorrow, it added.
The last major round of restructuring in 2019-2020 had brought down the number of state-run lenders from 27 to 12. A senior official told ET that while there is a recognized need for Indian banks to scale up globally, any new round of consolidation will depend on synergies and consultations with the lenders themselves. The aim would be to form at least three to four very large banks, it added.
ET further reported that the two-day summit will also include discussions between PSBs and key infrastructure financing entities such as the National Bank for Financing Infrastructure and Development (NaBFID) and India Infrastructure Finance Company (IIFCL).
Moneycontrol couldn't independently verify the report.
Punjab National Bank (PNB) and Canara Bank shares were the top gainers on the index, rising nearly 2 percent each. UCO Bank, Punjab & Sind Bank (PSB), Bank of Maharashtra and Bank of India shares rose more than 1 percent each.
Union Bank of India, Central Bank of India and State Bank of India (SBI) shares rose nearly 1 percent each, while Indian Bank, Bank of Baroda and Indian Overseas Bank shares were hovering in the green with marginal gains.
As of the June quarter, four public sector banks, which are UCO Bank, Indian Overseas Bank, Punjab & Sind Bank, and Central Bank of India, had government shareholding levels exceeding 90 percent.
In 2019, the government initiated a large-scale consolidation drive in the PSU banking space, merging 10 public sector lenders into four larger entities.
Also read: Our LIVE blog on stock market updates
Disclaimer: The views and investment tips expressed by experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with certified experts before taking any investment decisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
Find the best of Al News in one place, specially curated for you every weekend.
Stay on top of the latest tech trends and biggest startup news.
