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Shares of three state-run lenders—Central Bank of India, Punjab & Sind Bank, and Indian Overseas Bank—extended their losing streak on Wednesday
PSU Bank Stocks Decline
Shares of three state-run lenders—Central Bank of India, Punjab & Sind Bank, and Indian Overseas Bank—extended their losing streak on Wednesday, following a recent Qualified Institutional Placement (QIP) fundraising round.
Central Bank of India plunged nearly 12 per cent today, marking its third consecutive session of losses after already shedding over 6 per cent in the past two days. Similarly, Punjab & Sind Bank, which tumbled 20 per cent in the previous session, dropped another 8.3 per cent on Wednesday.
Indian Overseas Bank also remained under selling pressure, declining 5 per cent—its sixth straight session in the red.
Recently, Indian Overseas Bank raised ₹1,436 crore through QIP, with Life Insurance Corporation of India (LIC) and LIC Pension Fund collectively investing Rs 600 crore. Other major investors included IIFL Finance and NPS Trust, each acquiring over 5 per cent of the issue.
Notably, LIC contributed 25 per cent of the total capital raised across these three banks. Punjab & Sind Bank and Central Bank of India also allotted shares to other public sector banks as part of the fundraising initiative. Punjab & Sind Bank issued shares to Central Bank of India and Indian Overseas Bank, while Central Bank of India allocated shares to PNB, Canara Bank, and Bank of Baroda.
The fundraising aimed to bring government ownership in these banks in line with Minimum Public Shareholding (MPS) norms. However, the government’s stake in all four PSU banks remains above 90 per cent.
Meanwhile, the Nifty PSU Bank index declined over 1 per cent, with all 12 constituents trading in the red. Canara Bank, Union Bank of India, Bank of Maharashtra, and PNB were among those under pressure.
Despite the capital infusion, these stocks have struggled, all currently trading below their QIP issue price. As of Wednesday, Central Bank of India was down 12 per cent at Rs 36.4, Punjab & Sind Bank fell 8.3 per cent to Rs 31.9, and Indian Overseas Bank dropped 5 per cent to Rs 35.8.
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