“Advance activity” is in progress for the privatization of two public area banks (PSBs) as declared by Finance Minister Nirmala Sitharaman in the last Union Budget, Financial Services Secretary Sanjay Malhotra said on Monday.

In the Union Budget for 2021-22, Sitharaman had reported the privatization of two PSBs other than IDBI Bank.

Nonetheless, the current year’s Budget Speech had avoided the notice of the headway made for the privatization of two PSBs.

“To the extent that financial privatization is worried, there is an assertion on the floor of the House by the money serve for making empowering arrangement. Advance activity on this is in progress,” Malhotra said during the drapery raiser occasion for a festivity of Azadi Ka Amrit Mahotsav.

Indeed, even as the NITI Aayog has proposed names of two PSBs for privatization, the Center is yet to make an empowering arrangement in the law for the divestment of the public authority’s stake deal underneath the 51% limit.

The public authority had recorded the presence of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, in the Winter Session, yet the Bill was not postponed.

The Aayog had apparently recommended the privatization of the Central Bank of India and the Indian Overseas Bank.

The endorsement to privatize the two PSBs is yet to be viewed by the Core Group of Secretaries on Divestment (CGD) headed by the bureau secretary.

Once supported by the CGD, the proposition will be shipped off the Alternative Mechanism (AM) that includes Sitharaman and Minister of Roads, Transport, and Highways Nitin Gadkari.

After their gesture, the Cabinet will take up the proposition.

As per the corrections to the Banking Companies Act moved last year, the public authority is hoping to hold no less than 26% stake in PSBs post-privatization.