Punjab & Sind Bank is looking to raise funds through a Qualified Institutional Placement (QIP) and other methods to reduce the government’s holding in the bank. The move will help the bank meet the Securities and Exchange Board of India’s (SEBI) rule that all listed companies must have at least 25% public shareholding.
The bank’s managing director and CEO, Swarup Kumar Saha, said the board has approved the fundraise and the bank has hired merchant bankers and legal advisers to help with the process. The fundraising could take place in the current financial year, depending on market conditions.
Today, the government owns 93.85% of Punjab & Sind Bank, the highest stake among all public sector banks. Other banks with less than 25% public shareholding include Indian Overseas Bank (92.44%), UCO Bank (90.95%) and Central Bank of India (81.19%).
The government’s special dispensation to meet the minimum public shareholding norms for central public sector enterprises and financial institutions ends in 2026. It is likely to be extended for another two years, as many entities will not be able to meet the requirement by the deadline.
In addition to the fundraise, Punjab & Sind Bank plans to launch an International Financial Services Centre (IFSC) Banking Unit in GIFT City, Gandhinagar, by November this year. The bank has received approvals from the Reserve Bank of India and the International Financial Services Centres Authority (IFSCA) to set up the unit.
The new IFSC unit will act as a foreign branch, enabling the bank to mobilise foreign currency non‑resident deposits and external commercial borrowings. It will also help expand the bank’s balance sheet and bring in foreign exchange business.
The bank has already put staff in place and selected an IT vendor. IT integration work has begun, and the bank aims to start operations at the IFSC unit by November.