Decks cleared for government to buy State Bank stake

A meeting of the cabinet, chaired by PM Manmohan Singh, approved the ordinance to amend the State Bank of India Act of 1955 to buy the said equity from the Reserve Bank of India (RBI).

Decks have been cleared for the central government to buy the 59.73 per cent stake held by the Central Bank in the State Bank of India (SBI), it was announced on Friday.

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A meeting of the cabinet, chaired by Prime Minister Manmohan Singh, approved the ordinance to amend the State Bank of India Act of 1955 to buy the said equity from the Reserve Bank of India (RBI).

"The amendments would enable the transfer of RBI's shareholding in SBI to the central government," an official statement said. SBI is India's largest commercial bank.

"A bill will be moved in the coming session of parliament to replace the ordinance," Information and Broadcasting Minister Priya Ranjan Dasmunsi told reporters in New Delhi after the cabinet meeting.