The Reserve Bank of India (RBI) on Thursday said it has divested its 71.5% stake in National Bank for Agriculture and Rural Development, or Nabard, to the government, bringing down its holding in the bank to 1%.
The stake transfer has been valued at Rs1,430 crore, an RBI release said. Following this, the government stake in the development financial institution has gone up to 99%.
The move is in line with the Indian central bank’s strategy to bring down its holding in the development finance institutions and pass on the majority control to the government.
In May 2008, the Union Cabinet had approved RBI’s proposal to transfer its shareholding in Nabard.
In the past, RBI has transferred its stake in the nation’s largest lender State Bank of India to the government.
Nabard is mandated with facilitating credit flow for promotion and development of agriculture, small-scale industries, cottage and village industries, handicrafts and other rural crafts.