SBI, PNB, BOB, IOB, UCO & Other PSB Stocks Rally Amid Likely PSU Bank Merger in Apr–May Across 2–3 Tranches

Shares of public sector banks surged as much as 4% on Monday after reports emerged that the Finance Ministry is preparing a roadmap for the next wave of PSU bank mergers, with an official announcement likely in April or May. According to Informist, the mergers are expected to be implemented in 2-3 phases instead of being executed all at once.

PSU Banks Merger Likely in Apr-May, consolidation in 2-3 tranches: Informist Report

As per the report, the finance ministry is preparing a plan for the next phase of public sector bank mergers, with an announcement expected April and May. The mergers will occur in phases over several years, according to a senior official. The aim is to reduce the number of PSU banks from 12 to around 6 or 7, making them larger in scale.

"The government appears to be preparing for another major consolidation wave in public sector banks (PSBs), with plans to reduce the current roster of 12 banks to about 6-7 stronger institutions. The move is expected to unfold in multiple tranches over the next few months and aims to build globally competitive banks capable of supporting India's infrastructure and credit-intensive growth ambitions," said Mr. Naren Agarwal, CEO, Wealth1.

The government intends to merge smaller banks initially, possibly integrating them with State Bank of India (SBI) or Punjab National Bank (PNB). Before finalising the mergers, the government will review the banks' performance over two more quarters. In the September quarter, these banks collectively reported a net profit of Rs 495 billion, marking a 12% increase from the previous year.

Top PSU Banks Set for Mergers: SBI, HDFC, PNB, Bank of Baroda, Indian Overseas Bank, UCO Bank, Punjab & Sind Bank

The smaller PSU banks likely to be merged include Bank of Baroda, Central Bank of India, Indian Overseas Bank, UCO Bank, Punjab & Sind Bank, among others. As per September data, SBI had deposits worth Rs 55.92 trillion and advances totalling Rs 43.62 trillion with a net profit of Rs 201.60 billion for July-September.

HDFC Bank ranks second after SBI in terms of deposits at Rs 28.02 trillion and advances at INR 27.46 trillion with a net profit of Rs 186.41 billion for the same period. Punjab National Bank holds third place with deposits amounting to Rs 16.17 trillion and advances at Rs 11.34 trillion while reporting a net profit of Rs 49.04 billion.

GoodReturns has reached out to several banks, including SBI, HDFC and others, for updates on the PSU banks merger but has not received any responses so far. Some of them have declined to comment at this time, citing the sensitivity of the matter.

PSU Bank Stocks Today on Mega Merger Update

SBI Share Price Today

Shares of State Bank of India (SBI) were trading at Rs 972.95 on 17 November 2025 at 11:52 am, up by Rs 5.10 or 0.53% for the day. The stock opened at Rs 971.00, touched a high of Rs 976.00, and fell to a low of Rs 968.50 during the session. Over the past 52 weeks, SBI's shares have recorded a high of Rs 976.00 and a low of Rs 680.00.

PNB Share Price Today

On 17 November 2025, at 11:54 am, Punjab National Bank (PNB) shares were priced at Rs 124.01, up Rs 1.80 or 1.47% for the day. The stock opened at Rs 122.70, climbed to a high of Rs 124.85, and dipped to a low of Rs 122.31 during intraday trading.

Bank of Baroda Share Price Today

As of 11:58 am on 17 November 2025, Bank of Baroda Ltd shares were trading at Rs 289.75, up Rs 3.00 or 1.05% for the day. The stock opened at Rs 289.00, touched a high of Rs 292.40, and recorded an intraday low of Rs 289.00.

Indian Bank Share Price Today

On Monday, Indian Overseas Bank (IOB) saw a notable gain in its share price, rising by Rs 1.21, or 3.12%, to close at Rs 40.00 as of 12:08 pm on 17 November 2025. The stock opened at Rs 38.80, touched an intraday high of Rs 40.74, and recorded a low of Rs 38.80.

UCO Bank Share Price Today

On Monday, UCO Bank surged by Rs 0.72, or 2.34%, to trade at Rs 31.44 as of 12:09 pm on 17 November 2025. The stock opened at Rs 30.88, touched an intraday high of Rs 32.00, and a low of Rs 30.82.

"However, caution remains warranted. The specifics-such as which banks will merge, the execution timeline, and how integration risks like cultural fit, technology alignment, and legacy liabilities will be managed-are still unclear. While the intent of consolidation is sound, the success of the exercise will depend heavily on execution discipline and maintaining credit momentum through the transition," said the expert.

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