Overview
- Pankaj Chaudhary told the Lok Sabha there is no proposal under consideration to merge or consolidate public sector banks.
- The minister also said there is no plan to raise the foreign direct investment ceiling in PSBs from 20% to 49%.
- PSU bank shares fell on Wednesday after the clarification, with Indian Bank down about 5% and PNB losing over 3%, while several peers declined 1–2%.
- The government reiterated existing rules, noting PSBs have a 20% FDI cap, private banks allow up to 74%, and any holding of 5% or more in a bank requires prior RBI approval.
- The strategic disinvestment of IDBI Bank continues under the 2021 CCEA approval, with 60.72% on offer from the Centre and LIC alongside a transfer of management control.