Bank Investment Company may be approved in upcoming Budget, finally

A key question is how the BIC is to be funded. To start with, it may have to be a wholly-owned government entity

The Centre is set to breathe life into the Bank Investment Company (BIC) in the Union Budget 2021-2022, and, simultaneously, start the process of amending the Bank Nationalisation Acts of 1970 and 1980, and the State Bank of India (SBI) Act of 1955.

This will bring to fruition discussions between the Centre and the Reserve Bank of India (RBI), which have been on since June 2020. The Indian Banks’ Association has also figured in some of the parleys.

The lack of fiscal headroom, and the fact that the valuations of these banks are low, have resulted in the Centre’s stake