 "FinMin says SBI, PNB may tap capital market this year")
Financial Services Secretary G S Sandhu also said no final decision has been taken yet.
"Which banks will go first, that we have to work out. We have asked all banks to submit their capital requirement plans. They have given their proposal and we are giving final touch to them. The schedule will be worked out soon," he added.
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The decision would be based on various consideration including value of shares and possibility of going up further, he said.
Yesterday, Finance Minister Arun Jaitley in the Budget speech said that "to be in line with Basel-III norms there is a requirement to infuse Rs 2,40,000 crore as equity by 2018 in our banks. To meet this huge capital requirement we need to raise additional resources to fulfill this obligation."
While preserving the public ownership, the capital of these banks will be raised by increasing the shareholding of the people in a phased manner through the sale of shares largely through retail to common citizens of this country, he had said.
"Thus, while the government will continue to have majority shareholding, the citizens of India will also get direct shareholding in these banks, which currently they hold indirectly," he had said.
Government shareholding in various banks varies between 56.26 per cent to 88.63 per cent.
"So, we will have to device a strategy where we figure how much dilution will take place in these banks over a five- year time-frame, because we are not going to do it in just one go which is not possible also. This will happen over a timeframe of five years," he said.
Price to book value of the shares of most of the banks are close to one, he said, adding, "We expect them to go a little higher."
Government estimates that about 50 per cent of the requirement could be met from public offers. The remaining fund could be raised from other means like stake sale in non-core businesses of banks.
"Most of the insurance joint venture companies are not listed. Listing of insurance subsidiary would bring in money to the bank. In case the bank is not able to list, it can sell their stake or hive off to raise funds over a period of five years," he said.
State Bank of India (SBI) is country's largest bank and government holds 58.60 per cent stake. Punjab National Bank is the second largest PSU bank, in which governemnt holding is 58.87 per cent.