Last week Jaitley had said, "There was a strong case that the banks have made and therefore, I do believe that it's a case which merits the government seriously looking into it," Mr Jaitley told a news conference after a meeting with bankers.
This was largely to do with fresh capital infusion.
Shares in IDBI Bank rallied 3 per cent, while shares in Union Bank were up almost 2 per cent. Other notable winners from the space were PNB and State Bank of India.
Several of the PSB stocks have been hitting lows with Oriental Bank, Canara Bank and Punjab National Bank falling to recent lows.
For investment related articles, business news and mutual fund advise, subscribe to GoodReturns.