PSBs rally on privatisation buzz; Nifty PSU Bank index up 2%; PNB gains 4%

The prime minister’s office wrote a letter to finance ministry earlier this month asking it to expedite the process of privatising these lenders
Shares of public sector banks were trading higher, in an otherwise range-bound market, rallying up to 6 per cent on the National Stock Exchange (NSE). At close, the Nifty PSU Bank index ended 2.36 per cent higher, having zoomed 3.2 per cent in the intra-day trade. 

Among individual stocks, Punjab National Bank jumped 5.2 per cent to Rs 34.6 apiece on the NSE in the intra-day trade. According to media reports, the US Bankruptcy court has recognised the claim of Punjab National Bank on proceeds of any asset sold by the American debtors of Nirav Modi entities.

"This is the first time the MCA has recovered money from overseas. It is also the first time the MCA has intervened in a foreign case pertaining to an Indian company and recovered money," said a report by Moneycontrol. 

MCA had filed a petition on February 26, 2018, in the bankruptcy proceedings against Nirav Modi in a US court, and sought to have PNB made a party to the sale of any assets of his entities, the report added.

That apart, Canara Bank, Bank of Maharashtra, Bank of Baroda, and State Bank of India surged between 2.6 per cent and 6 per cent in the intra-day trade today. Other PSBs such as Indian Bank, Bnak of India, Union Bank of India, J&K Bank, Indian Overseas Bank, UCO Bank, and Central Bank were up between 0.5 and 1 per cent at 11:32 am. In comparison, the Nifty50 index was at 11,422 level, up 0.32 per cent. 

According to a Reuters report, Prime Minister Narendra Modi’s office has asked officials to speed up the process of trimming government stakes in at least four primarily state-owned banks within the current fiscal year.

"The four lenders are Punjab & Sind Bank, Bank of Maharashtra, UCO Bank, and IDBI Bank, in which the Indian government owns majority stakes through direct and indirect holdings," the report said, quoting unnamed sources in the government.

The prime minister’s office wrote a letter to finance ministry earlier this month asking it to expedite the process of privatising these lenders in the current financial year, which ends in March 2021, told one government source to the news agency.

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