Inching a step closer to the privatisation of two public sector banks, a high-level panel headed by the cabinet secretary recently held a meeting to thrash out various regulatory and administrative issues so that the proposal could be placed with the group of ministers on disinvestment or Alternative Mechanism (AM) for approval.

Following the announcement made by finance minister Nirmala Sitharaman in her 2021 budget speech, the Niti Aayog has suggested a couple of bank names for privatisation to the core group of secretaries on disinvestment headed by the cabinet secretary in April, sources said.

Central Bank of India and Indian Overseas Bank are reported to be probable candidates for privatisation.

The meeting of the high-level panel deliberated on the recommendation of Niti Aayog on June 24, sources said, adding the panel would after tying up all the loose ends will send the names of the shortlisted PSU banks to AM for consideration.

Headed by the cabinet secretary, the members of the panel include secretaries in the departments of economic affairs, revenue, expenditure, corporate affairs and legal affairs, as well as the secretary of administrative department. The panel also has secretaries in the department of public enterprises and the department of investment and public asset management (Dipam) as its members.

According to sources, the panel also examined issues pertaining to the protection of interests of workers of banks which are likely to be privatised. Following a clearance from AM, it will go to the Union cabinet headed by the Prime Minister for the final nod.

The government has budgeted Rs 1.75 lakh crore from stake sale in public sector companies and financial institutions, including two PSU banks and one insurance company, during the current financial year.