The bill to lower the stakeholding of government on the country’s biggest personal loan lender, State Bank of India has been approved by the Parliament. Now, the government stake would go down to 51% thus allowing the bank to generate more capital.
Finance Minister Pranab Mukherjee said, “The bill (State Bank of India Amendment 2010) also seeks to enable the SBI to issue bonus shares”.
The government presently holds 59.41% stake in SBI.
The bank has just reported a 25% increase in its net profits for Q1.
But Mukherjee said that there is no plan to reduce the government holding in the bank still more. He said the government won’t reduce its majority stake in the bank.