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In a major overhaul in the banking sector, the government is planning to privatise more than half of the state-owned banks, reported Reuters quoting sources.
The idea is to limit the number of state-owned lenders to just five by selling majority stakes in Bank of India, Central Bank of India, Indian Overseas Bank, UCO Bank, Bank of Maharashtra and Punjab & Sind Bank, said the report.
The finance ministry has not commented on the matter so far, as per the report.
The privatisation plan comes at a time when the economy is strapped due to the ongoing COVID-19 pandemic and the government is trying to raise money by selling assets in none-core companies and sectors.
According to the Reuters report, several government committees and the Reserve Bank of India (RBI) have recommended that India needs to limit its state-owned banks to five.
In 2019, the government had merged ten state-owned banks into four but the government official told Reuters, "The government has already said that there will be no more mergers (between state-owned banks) so the only option for them is to divest stakes."
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