The Centre is planning to reduce its shareholding in four public sector banks — Central Bank of India, UCO Bank, Punjab & Sind Bank and Indian Overseas Bank — to 75%, The Economic Times reported on Friday, October 23. The reported move is aimed at meeting the Securities and Exchange Board of India's (SEBI) minimum public shareholding norm, which requires listed companies to keep at least 25% of shares with public investors.

Source: The Economic Times report via 7Globe

The stake sales are likely to be carried out through the Offer for Sale (OFS) route, depending on market conditions, and the first phase of the exercise is expected to be completed within a year, according to the report. The four lenders have so far operated under an exemption from the public-float norm that allowed the government to hold more than 75%.

Source: Whalesbook summary of the reported plan

93.85%Govt stake in Punjab & Sind Bank (end-Mar 2026)
92.44%Govt stake in Indian Overseas Bank
90.95%Govt stake in UCO Bank
89.27%Govt stake in Central Bank of India

Finance Ministry Department of Financial Services data cited in coverage of the report put government ownership at the end of March 2026 at 93.85% in Punjab & Sind Bank, 92.44% in Indian Overseas Bank, 90.95% in UCO Bank and 89.27% in Central Bank of India — so each bank needs a different-sized dilution to reach the reported 75% level.

Source: EL7.AI summary citing DFS data

A cut to 75% is a dilution, not a privatisation: the government would remain the majority owner of all four banks. The Economic Times report also said the government is exploring the next phase of public sector bank consolidation, under which it could eventually retain three to four large state-owned banks and identify two more lenders for privatisation — those longer-term elements remain reported plans, and no official announcement from the Finance Ministry or DIPAM had been made at the time of publishing.