Shares of Indian Overseas Bank and Central Bank of India are performing well today. The government may soon disinvest both the banks
Tremendous jump in the shares: Shares of IOB and CBI are performing well today
There was a tremendous jump in the shares of both the banks on Tuesday, due to which they reached their 52-week high.
The share of IOB registered an increase of 18 percent. At the same time, the business of CBI has increased by 16 percent. The government has shortlisted these banks for disinvestment.
Central Bank of India touched a 52-week high of Rs 28.30. While Indian Overseas Bank hit a 52-week high of Rs 27.95. According to a CNBC report, the Center has chosen CBI and IOB for disinvestment. In the last session, the share prices closed at the upper circuit of 20 per cent.
Two public sector banks, reaching a 52-week high.
According to the report, in the first phase of disinvestment of both the PSBs, 51 per cent sales can happen. For disinvestment, the government can amend the Banking Regulation Act and some other banking laws.
Banking analysts believe that weak financial metrics of lenders like CBI and IOB could create an unexpected hurdle in the government’s plan to privatize lenders.
The government has shortlisted these banks for disinvestment.
Both IOB and CBI are currently working under Prompt Corrective Action (PCA) imposed by Reserve Bank of India (RBI).
Through this, the central bank imposes certain commercial restrictions on lenders with weak financial metrics.
It is to be known that the Center has set an ambitious disinvestment target of Rs 1.75 lakh crore for the financial year 2022.
Indian Overseas Bank was trading at Rs 26.50 on the BSE this morning with a gain of Rs 2.90, ie an increase of about 12.29 percent. At the same time, Central Bank of India was also trading at Rs 27.20, up by Rs 2.90, or about 11.93 percent.