Goldman Sachs Named Advisor for Govt Stake Sale in Four Public Sector Banks

New Delhi: The Government of India has appointed global investment banking firm Goldman Sachs as the sole transaction advisor for its planned stake sale in four public sector banks namely, Indian Overseas Bank, UCO Bank, Central Bank of India, and Punjab & Sind Bank.

The move is part of a broader strategy to reduce the Centre’s shareholding in state-run banks to below 75%, in compliance with SEBI’s rule that mandates at least 25% public ownership in all listed companies. Currently, government holdings in these banks exceed 90%, with Punjab & Sind Bank having the highest at 98.3%.

Goldman Sachs will advise on all key aspects of the disinvestment process, including deal structuring, investor outreach, and coordination of the actual stake sale. Its appointment follows a July 2025 meeting of the Inter-Ministerial Group (IMG), which finalized the roles of transaction advisors and merchant bankers for this initiative.

Earlier this year, the Department of Investment and Public Asset Management (DIPAM) invited bids to manage stake sales in five PSBs, including Bank of Maharashtra. However, the current mandate covers only four banks, excluding Bank of Maharashtra.

The stake dilution may be carried out via either the Offer-for-Sale (OFS) route or Qualified Institutional Placement (QIP). The government aims to raise approximately ₹45,000 crore through QIPs in FY 2025–26, with State Bank of India (SBI) expected to contribute ₹20,000 crore. The remaining amount is expected to come largely from the four banks under Goldman Sachs’ advisory.

The disinvestment is likely to take place in the second half of FY 2025–26, depending on market conditions and investor interest. The urgency is underscored by the August 2026 deadline for public sector banks to comply with SEBI’s minimum public shareholding norms.