Both the banks denied having any knowledge in the matter.
Share price of Indian Overseas Bank closed the day up 13% at Rs 22.45 on BSE after touching an intra-day high of 23.80. Shares of Central Bank of India rose 10.5% to Rs 22.70 at the end of Wednesday’s trading, having closed from an intraday high of Rs 23.65.
“We do not have any information regarding privatization of the bank as on date. No such talks/events are taking place at the level of Central Bank of India,” the bank said in a regulatory filing to the stock exchanges.
Indian Overseas Bank also said that it has not received any communication from the government regarding privatization. “We are unaware of the reasons for the sudden change in stock price. This could be due to speculation,” the bank said.
Both the state-owned lenders made this regulatory disclosure at market hours.
NS reserve Bank of India India has recently lifted trade restrictions from Indian Overseas Bank under the prompt corrective action framework, while the Central Bank of India is still under regulatory curbs.
Finance Minister Nirmala Sitharaman announced Union Budget That the two public sector banks will be privatized in this financial year without giving specific names. LIC-owned IDBI Bank is also expected to be disinvested in this fiscal.
Among the public sector lenders, Bank of India and Bank of Maharashtra could also be candidates for privatization, as was the case with previous media reports.