- By Kamakshi Bishnoi
- Mon, 19 May 2025 03:20 PM (IST)
- Source:JND
Following the merger of North Bihar Gramin Bank and South Bihar Gramin Bank, the newly formed Bihar Gramin Bank—now the sole regional rural bank (RRB) in Bihar—has officially begun operations from May 1. The bank is now preparing to launch its Initial Public Offering (IPO), a move that aligns with one of the primary objectives behind the merger.
The Ministry of Finance has issued directives to all sponsor banks to initiate the process of issuing IPOs for RRBs, aimed at disinvestment and capital mobilisation. The Centre currently holds a 50 per cent stake in regional rural banks, while sponsor banks hold 35 per cent, and state governments hold the remaining 15 per cent. The central government intends to dilute up to 36 per cent of its stake to raise funds from the market.
Although efforts to bring RRBs to the stock market began in 2015, weak financial performance had delayed the IPO rollout. However, with the recent consolidation ensuring one rural bank per state and stronger base capital, these institutions now meet eligibility criteria for market listing.
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Despite the government’s move, rural bank unions have raised serious concerns, calling the IPO push a step toward privatisation. A joint meeting of unions from both erstwhile banks was held on Sunday to strategise opposition at the national level. DN Trivedi, General Secretary of the United Forum of Gramin Bank Unions, stated that any attempt to privatise the rural bank sector through IPOs will be resisted nationwide.
Leaders from various banking associations, including Bihar Provincial Bank Employees Association General Secretary Anirudh Kumar, AIBOA National Vice President Kumar Arvind, and others like Mohd. Nadeem Akhtar, Neeraj Chaudhary, Rajiv Prakash, and Kundan Kumar Rai, also addressed the meeting. The session was presided over by Pradeep Kumar Mishra and Brahmeshwar Kumar.
Unions have signaled plans for a broader movement if the government proceeds without addressing their concerns.