The Government of India has appointed Goldman Sachs as the exclusive transaction advisor for its planned divestment in four public sector banks: Indian Overseas Bank, Central Bank of India, UCO Bank, and Punjab & Sind Bank. With the government currently holding over 90 percent ownership in each of these institutions, the move represents a crucial step in the broader disinvestment program aimed at enhancing efficiency and competitiveness in India’s banking sector.

In this role, Goldman Sachs will assist in structuring the transactions, identifying potential investors, and ensuring smooth execution of the stake sales. The divestment process will not only support the government’s privatization goals but also help these banks comply with the minimum public shareholding norms mandated for listed entities.

The stake sale is expected to be carried out in phases beginning in fiscal year 2025–26 and may span two to three years. Initial plans suggest that the government could offload around five percent in each of the four banks in separate tranches, inviting greater market participation and strengthening the operational performance of these state-run lenders.

The initiative also ties into regulatory requirements under the Minimum Public Shareholding guidelines, which require listed companies to maintain at least 25 percent public ownership. While public sector banks currently enjoy temporary relief from these norms until August 2026, the government may seek an extension depending on the pace of divestment.

This effort is part of a larger reform agenda by the Department of Investment and Public Asset Management, which is overseeing multiple disinvestment and privatization initiatives across state-owned enterprises. By bringing in Goldman Sachs, the government signals its determination to strengthen governance, attract fresh investment, and improve the overall financial health of India’s public-sector banking system.