Economic Times reporting on TCI Fund buying of PSU shares

Exactly 3 months after we spotted that The Children Investment (TCI) Fund is buying aggressively in PSU Bank counters, The Economic Times has carried an front page article on this. The earlier write ups in this blog on TCI buying can be read here and here.

TCI Fund has acquired more than 9% stakes in 3 PSU banks, Punjab National Bank, Vijaya Bank and Indian Overseas Bank. The maximum threshold limit for FII to buy in the PSU Bank stocks is 10% and they are close to achieving that. In addition to these 3 banks, they have also bought more than 4% stake in Bank of Baroda and Union Bank of India.

After the trust vote, which UPA won recently, the Finance Minister has gone on record saying that during the Monsoon session of the Parliament, Government would introduce the Banking Regulation Amendment Bill which allows voting rights according to the shareholding pattern. As of now, the voting rights in PSU Banks are not in proportion to the shareholding pattern and the Government still retains the so called "golden share".

Things are hotting up on the Banking space, particularly the PSU Banking space with the BR Amendment. Thanks to Communists for withdrawing support to the Government, otherwise, this would have been unthinkable. We have to wait and watch how things span out in the months to come with regard to further reforms in the financial services space by the Government.

Click here to read the Economic Times article on TCI Fund's purchase of PSU Bank shares.