December Shake-Up: BSE Bankex Expands with New Banking Powerhouses

Updated: November 25, 2025 22:00

Image Source: Mint

The BSE Bankex index will see a significant revision effective December 26, 2025, with Canara Bank, AU Small Finance Bank, Punjab National Bank, and Union Bank of India set to be added. This reconstitution aligns with new SEBI norms on index composition and weight caps.

The Bombay Stock Exchange (BSE) is set to implement a revision in the constituents of its prominent banking index, the BSE Bankex, effective from December 26, 2025. This move forms part of a broader reconstitution exercise across several BSE indices designed to align with recent SEBI prudential norms aimed at enhancing the index's representation and stability.

The revision will expand the Bankex universe by adding four new banks: Canara Bank, AU Small Finance Bank, Punjab National Bank, and Union Bank of India. Notably, there are no deletions specified for this round, indicating an increase in the total number of constituents tracked by the index.

This rebalancing exercise is grounded in a new methodology introduced by BSE Index Services wherein constituents are weighted based on float-adjusted market capitalization. Critical caps have been instituted to keep any single bank’s weight below 20%, the top three banks combined under 45%, and the top five banks combined under 60%. These measures aim to minimize turnover and reduce concentration risk within the index.

Key highlights of the BSE Bankex revision:

Effective Date and Scope
The changes come into effect at the start of trading on December 26, 2025, part of BSE’s semi-annual methodology review process.
New Additions to Bankex
Four banks — Canara Bank, AU Small Finance Bank, Punjab National Bank, and Union Bank of India — will be inducted, broadening the index’s coverage in the banking sector.
Methodology Update
Constituents will now be weighted with stricter caps on size and concentration, fostering a more balanced index profile.
Alignment with SEBI Norms
The revision complies with SEBI’s deadline for Bankex to meet minimum constituent and weightage norms by December 31, 2025.

This recalibration is expected to impact market participants who track or invest in Bankex-linked funds, as the reconstituted index reflects a more diversified banking sector representation with risk controls firmly in place.

Sources: BSE Index Services, Economic Times, News18, Business Standard, SMS Financial, BSE Indices official notice.

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