Govt seeks to cut stake in SBI to 51%

The government on Monday sought parliamentary approval to cut its stake in top lender State Bank of India to 51 per cent from 55 per cent, seeking to raise $1.2 billion (Rs 5,000 crore) at current market prices from the key reform move. The government had earlier said it would move to cut its holdings in state-run banks while retaining majority control, but has faced political and union opposition. The government owns 59.41 per cent of State Bank of India (SBI) and already has lawmakers' approval to trim it to 55 per cent. On Monday, Finance Minister Pranab Mukherjee introduced in parliament a bill seeking approval for SBI to raise capital by a public issue or private placement of shares or through a rights issue. SBI shares were up 2.5 per cent at Rs 2,096 by 1:12 p.m., outpacing the 1 per cent rise in the Sensex and the 1.25 per cent rise in the bankex.