SBI, other PSU banks stocks rise up to 3% on reports of government move to raise FDI limit to 49%

Core Insights - India is planning to allow direct foreign investment in state-run banks of up to 49%, more than double the current limits, as part of efforts to align regulations for government-owned and private banks [6] - The finance ministry has been in discussions with the Reserve Bank of India (RBI) regarding this proposal, which is still in the finalization stage [6] - The rise in foreign investment in the banking sector is notable, with significant recent investments from foreign entities [2][6] Foreign Investment Trends - Emirates NBD announced a Rs 26,853 crore investment in RBL Bank, marking the largest-ever foreign investment in India's financial services sector [6] - Sumitomo Mitsui Banking Corporation (SMBC) acquired a 24.2% stake in Yes Bank for nearly Rs 15,000 crore earlier this year [2][6] - Abu Dhabi's International Holding Company (IHC) committed $1 billion (Rs 8,850 crore) to Sammaan Capital, aiming for a 41% stake [5][6] Market Reactions - Shares of public sector banks, including State Bank of India and Indian Bank, saw gains of up to 3.3% following the news of potential foreign investment increases [6] - Bank of Baroda shares rose to an intra-day high of Rs 277, while Canara Bank shares increased over 2% to Rs 132 [5][6] - Indian Bank reached a day high of Rs 854, reflecting a 3.3% increase from the previous close [5][6]