# Government cuts stake in 4 PSU banks to 75%

> Government plans to reduce its stake in four public sector banks to 75% for privatisation.
- Title: Government cuts stake in 4 PSU banks to 75% | Shortify
- Summary: Government plans to reduce its stake in four public sector banks to 75% for privatisation. The Indian government aims to reduce its stake in four public…
- Keywords: government, public sector banks, privatisation, central bank of india, indian overseas bank, uco bank, idbi bank, cuts, stake, PSU, banks, The Economic Times
- Source: The Economic Times — https://economictimes.indiatimes.com/industry/banking/finance/banking/govt-plans-to-pare-its-stakes-in-four-psu-banks-to-75/articleshow/135125928.cms
- Author: Dheeraj Tiwari
- Published: 2026-10-23T00:30:00+00:00
- Read time: 1 min
- Topics: government, public sector banks, privatisation, central bank of india, indian overseas bank, uco bank, idbi bank
## Government plans to pare stakes
The government is considering paring its stake in four public sector banks to 75% to meet the stock market regulator's mandated minimum public shareholding.
## NITI Aayog shortlists banks
The NITI Aayog reportedly shortlisted Central Bank of India and Indian Overseas Bank as the two candidates for privatisation.
## IDBI Bank acquisition
Canadian billionaire Prem Watsa-promoted Fairfax Financial Holdings will acquire a 60.72% stake in IDBI Bank for Rs 52,878 crore.
## Next round of consolidation
The government is working on a strategy for the next round of consolidation in public sector banks that could identify two more banks for privatisation.
## Public shareholding increase
The first step is to increase public shareholding in the four lenders in the next one year, with the government offloading its stake through the offer for sale route.
## Valuation improvements
The greater public float is expected to improve the valuation of the banks, with privatisation plans considering factors like technology compatibility and geographical spread.
## Key takeaway

The Indian government aims to reduce its stake in four public sector banks to 75% to meet stock market regulator requirements and prepare for future privatisation.