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Govt approves bill to lower govt stake in SBI

Govt approves bill to lower govt stake in SBI
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First Published: Thu, Aug 12 2010. 06 32 PM IST
Updated: Thu, Aug 12 2010. 06 32 PM IST
New Delhi: Parliament approved a bill on Thursday enabling the government to reduce its holding in State Bank of India, the country’s largest lender, to 51% and help it raise capital.
“The bill (State Bank of India Amendment 2010) also seeks to enable the SBI to issue bonus shares,” finance minister Pranab Mukherjee said while replying to a debate on the bill.
The bill would also enable the bank to raise funds through preference shares, rights issue, preferential allotment or private placement of shares, he said.
The government’s holding in the bank now stands at 59.41%.
SBI,which has 4,496 branches across the country and about 0.2 million employees, posted a 25% rise in quarterly profit on Thursday, beating forecasts.
SBI’s shares closed up 6.9% at Rs2,784 rupees after the June quarter results, outperforming the broader market that ended flat.
Mukherjee said the performance of the bank has so far been reasonably satisfactory, and there was no plan to bring down the government stake in the bank. He said the government will not dilute its majority stake in the bank.
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First Published: Thu, Aug 12 2010. 06 32 PM IST