Govt to introduce Bill to amend banking law; privatise 2 public sector banks

In the forthcoming Winter Session of Parliament, the government will introduce the Banking Laws (Amendment) Bill 2021, which will allow the government to privatise two public sector banks (PSBs) as part of its disinvestment plan for the current fiscal year.

This Bill is one of 26 new Bills on the government’s legislative agenda, out of a total of 29 Bills. To effect amendments in Banking Companies (Acquisition and Transfer of Undertakings) Acts, 1970 and 1980 and incidental amendments to Banking Regulation Act, 1949 in the context of Union Budget announcement 2021 regarding privatisation of two Public Sector Banks.

As part of the government’s divestment plan, Finance Minister Nirmala Sitharaman said in the Union Budget 2021 that two public sector banks would be privatised.

“To effect amendments in the Banking Companies (Acquisition and Transfer of Undertakings) Acts, 1970 and 1980, and incidental amendments to the Banking Regulation Act, 1949 in the context of the Union Budget announcement 2021 regarding privatisation of two Public Sector undertakings,” according to the bill.

The bill is not likely to mention the names of the two banks that are going to be privatized.