State-owned Power Finance Corporation (PFC), which has been looking to foray into the banking space, has sought the finance ministry’s permission to acquire a substantial stake of 26% or even more in one of the five public sector banks including Punjab and Sindh Bank, Indian Bank, Central Bank of India, Bank of Maharashtra and the United Bank of India.
Top finance ministry officials confirmed having received a proposal from PFC in this regard and said it is holding consultations with the Reserve Bank of India (RBI) on the proposal.
HT is in possession of PFC’s proposal sent to the finance ministry on April 2.
While Satnam Singh, chairman and MD, PFC, refused comments on the company’s proposal for purchasing a stake in the five banks, sources told HT that the proposal was discussed recently by PFC chief with Arvind Mayaram, secretary, department of economic affairs and finance ministry officials. “The proposal is with the RBI,” they said.
There is no restriction on acquiring stake in a public sector banks except that permission has to be taken from the government, which holds a majority stake in these banks.