Archive · 2 Dec 2025
India Denies PSU Bank Merger Plans
The Indian government has said that there are no plans to merge or consolidate public sector banks (PSBs).
This statement was made by the Minister of State for Finance in response to questions in the Lok Sabha.
The government also provided information on the foreign direct investment limits in PSBs and private banks, and the disinvestment of IDBI Bank.
Additionally, the financial health of Regional Rural Banks (RRBs) has improved, with record net profits in recent years.
The government's statement contradicts earlier media reports that suggested plans for consolidating PSBs to create larger institutions.
The Indian government has denied any proposal on the merger or consolidation of public sector banks (PSBs).
The Foreign Direct Investment (FDI) limit in PSBs is 20%, while in private sector banks it is 74%.
The disinvestment of IDBI Bank is being carried out as per the CCEA approval, with 60.72% of its equity being offered for strategic disinvestment.
Regional Rural Banks (RRBs) have shown significant improvement in financial health, posting record net profits in FY24 and FY25.
The government's statement contradicts earlier media reports that suggested plans for consolidating PSBs to create larger institutions.
- Who
- Indian Government and Minister of State for Finance Pankaj Chaudhary
- What
- Denial of any proposal on merger or consolidation of PSBs
- When
- Informed on Monday
- Where
- India
- Why
- To clarify the government's stance on PSB mergers and consolidation
Government
Media Reports
Merger Plans
Government
No proposal on merger or consolidation of PSBs is under consideration.
Media Reports
Government is planning to consolidate PSBs to create fewer, larger institutions.
- FDI Limit in PSBs
- 20%
- FDI Limit in Private Banks
- 74%
- IDBI Bank Disinvestment
- 60.72% equity being offered for strategic disinvestment
- IDBI Bank Capital and Liabilities
- Rs 4.11 lakh crore
- RRBs Net Profit FY24
- Rs 7,571 crore
- RRBs Net Profit FY25
- Rs 6,825 crore
Sources
Mega PSU bank merger plan: Can India do it without amplifying risks?
Government rules out PSU bank mergers; IDBI Bank disinvestment to proceed
'No Proposal On Merger Or Consolidation Of Public Sector Banks Is Under Consideration Of The Government': Minister Of State
