'SEBI' May Be Asked To Relax 75% Promoter Stake Norm For Public Sector Banks

BY ANJANA DAS

With an aim to enable the further recapitalisation of public sector banks (PSBs), the Finance Ministry may seek a relaxation for PSBs in the market regulator Sebi’s norms for entities requiring promoters to have 75 per cent holdings in them, according to a senior official source The Securities and Exchange Board of India (Sebi) listing norms mandate that every listed entity will maintain a minimum public shareholding of 25 percent.

The government shareholding in many state-run Public Sector Banks is currently above 75 percent. In case of their further recapitalization, this will go up over 90 percent in some cases and also touch 99 percent. In previous years, the government had taken Sebi approval for recapitalizing PSBs which had pushed up the government’s stakes in these banks.

Asked if individual banks will take permission for exemption from Sebi’s 25 percent public shareholding norm, the source said the Finance Ministry seeks the approval from the market regulator. In fact, the government has plans to cut its shareholding in many PSBs to 52 percent. Market condition, however, has so far not been suitable enough for banks to move in this direction, the source pointed out. The country’s largest lender State Bank of India (SBI) has already initiated steps for Rs 20,000 crore share sale through qualified institutional placement (QIP). (IANS)

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