Insurers could buy bank stakes

Keen to bolster banks capital base but hamstrung by fiscal strain, the government is mulling selling some parts of its stakes in a clutch of nationalised banks to state-owned entities like Life Insurance Corporation and General Insurance Corporation. Even after the stake sales, the government will continue to be in total control of these banks, either on its own or through cross-holdings. Official sources said the finance ministry has initiated talks with top managements of banks, including SBI and Punjab National Bank, for the stake sales. The rationale behind the move is that it would enable the Centre to infuse ...

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