Central Bank of India stock fell nearly 12% today, marking its third consecutive day of losses. The stock had already dropped over 6% in the last two trading sessions. Similarly, Punjab & Sind Bank, which plunged 20% in the previous session, declined another 8.3% on Wednesday.
Indian Overseas Bank also faced continued selling pressure, shedding 5% today, making it the sixth straight session of decline for the stock.
Indian Overseas Bank recently raised Rs 1,436 crore through QIP, with Life Insurance Corporation of India (LIC) and LIC Pension Fund collectively subscribing to Rs 600 crore worth of shares. Other key investors included IIFL Finance and NPS Trust, each acquiring over 5% of the QIP issue.
Interestingly, 25% of the total capital raised through this process across the three banks came from LIC. Punjab & Sind Bank and Central Bank of India also allocated shares to other public sector banks as part of the fundraising initiative.
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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 effort aimed to reduce government ownership in these banks to comply with the Minimum Public Shareholding (MPS) norms. Currently, the government’s stake in all four PSU banks remains above 90%.
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Meanwhile, the Nifty PSU Bank index fell over 1%, with all 12 constituents trading in the red. Canara Bank, Union Bank of India, Bank of Maharashtra, and PNB were also under pressure.
Despite the capital infusion, these stocks have struggled, with all of them now trading below their QIP issue price. As of Wednesday’s trading session, Central Bank of India was down 12% at Rs 36.4, Punjab & Sind Bank slipped 8.3% to Rs 31.9, and Indian Overseas Bank declined 5% to Rs 35.8.
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