Reserve Bank to list weak banks for restructuring

RBI is in the process of preparing a list of weak banks, which can be restructured with induction of FDI. The central bank has recently said foreign banking companies can pick up more than 5 per cent stake only in those private sector banks, identified as ‘‘weak’’. FDI in weak banks can eventually go up to 74 per cent. Official sources said listing of weak banks by RBI would pave the way for a host of foreign banking entities including GE Money to pick up substantial stakes in such banks. Earlier, a clutch of banks including Bank of Punjab, Catholic Syrian Bank, Federal Bank, Karur Vysya Bank were reported to be seen as takeover targets. ‘‘Until the list is out, no entity would make any move. There are a host of banks, which are waiting in the wings to make a foray in the Indian financial sector,’’ a government official said.