Govt stake in Bank of Maharashtra to come down to 75 pc post share sale: MD

Mumbai, Aug 25 (PTI) State-owned Bank of Maharashtra is confident of meeting the minimum public shareholding norm of 25 per cent after one more tranche of fundraising in the current fiscal, its Managing Director & CEO Nidhu Saxena said on Monday.

One more round of share sale will help the bank with both capital adequacy and lower government stake, Saxena told reporters on the sidelines of FIBAC 2025, organised by FICCI and the Indian Banks Association here.

The finance ministry has asked five public-sector banks to increase the public shareholding limit to 25 per cent by August 1, 2026.

This is in line with the Securities Contract (Regulation) Rules issued by the Securities and Exchange Board of India, which mandate that all listed companies, including those in the public sector, must have a minimum public shareholding of 25 per cent.

Capital market regulator Sebi has given forbearance to CPSEs and public sector financial institutions till August 2026.

Currently, the government holds 79.6 per cent stake in the Pune-headquartered bank.

According to its current market capitalisation, if the bank raises around Rs 2,000-2,500 crore, the government's holding will fall below the 75 per cent mark, Saxena said, adding that it has taken an approval of Rs 7,500 crore fund raise via debt and equity to be on the safer side.

In October, BoM raised Rs 3,500 crore through a QIP, which resulted in the public shareholding in the bank rising to 20.4 per cent from 13.5 per cent at the end of September.

According to Saxena, the bank is yet to firm up whether the fundraising will happen through a qualified institution route or offer for sale route. "We are still evaluating the mechanism," he said.

BoM is comparatively well-positioned among the five public-sector banks in which the government has to lower its stake.

The government holds 94.6 per cent stake in Indian Overseas Bank, 93.9 per cent in Punjab & Sind Bank, 91 per cent in UCO Bank, and 89.3 per cent stake in Central Bank of India.

The state-owned Bank of Maharashtra registered a net profit of Rs 1,593 crore in the June quarter, up 23 per cent helped by increase in interest income.

Speaking about the financial results, Saxena said that like many of his peers, BoM is not too worried about fall in treasury income during the Jul-Sept quarter.

He also said that transactions on the Reserve Bank of India's Unified Lending Interface are picking up, although at a slower pace. Over the course of time, I expect transactions will improve, he said. PTI AA DP MR