The nation’s largest lender State Financial institution of India (SBI) has requested the Reserve Financial institution of India (RBI) to permit banks to fund acquisitions, the financial institution’s chairman Challa Srinivasulu Shetty mentioned on Monday. Presently, Indian banks should not allowed to lend for mergers and acquisitions.
Due to this rule, when firms plan to purchase different companies, they normally flip to non-banking monetary establishments or elevate funds by bonds.
Talking at an business occasion, Shetty mentioned SBI has requested the RBI to contemplate permitting acquisition financing at the very least for big listed firms.
The request comes at a time when public sector banks (PSBs) have reported robust income and improved steadiness sheets.
General, the 12 public sector banks posted a document revenue of Rs 44,218 crore within the April-June quarter (Q1) of FY26, up 11 per cent over the identical interval final yr.
SBI alone contributed 43 per cent to this, with a web revenue of Rs 19,160 crore.
SBI was on prime with a web revenue of Rs 19,160 crore within the April-June quarter, up 12 per cent from Q1 FY25. By way of dimension and income, the nation’s largest lender nonetheless controls the general public banking market.
Within the final three monetary years (FY23 to FY25), public sector banks raised about Rs 1.54 lakh crore by fairness and bonds to strengthen their capital base and assist mortgage progress.
The finance ministry will evaluation the efficiency of those banks this week, specializing in their monetary well being and progress outlook.
If RBI accepts SBI’s proposal, it might open up a brand new funding possibility for Indian firms trying to increase by acquisitions.
With the inputs of IANS
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