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PSU Bank Stocks Fall as Government Rules Out FDI Increase
PSU Bank stocks slump after the government rules out increasing FDI limit from 20% to 49%, with Indian Bank falling the most by 5.
Shares of public sector banks (PSU) took a hit on Wednesday after the Ministry of Finance clarified that it would not be increasing the foreign direct investment (FDI) limit in state-run banks from 20% to 49%. Indian Bank saw the steepest decline, plunging 5.5%, while Punjab National Bank and Canara Bank dropped 4.3% and 3.8%, respectively. Bank of Baroda and Punjab & Sind Bank also saw significant losses, falling more than 3% each. The announcement by the government dashed hopes of greater foreign investment in these banks, which had led to speculation of a boost in their capital base.