LIC is currently the promoter of IDBI Bank with management controlThe Cabinet Committee on Economic Affairs chaired by Prime Minister Narendra Modi on Wednesday approved tactical disinvestment in addition to transfer of management control in IDBI Bank.
Government of India and LIC together own more than 94 per cent stake in IDBI Bank (Federal Government of India owns 45.48 per cent and LIC 49.24 per cent).
LIC is presently the promoter of IDBI Bank with management control and central government is the co-promoter.
The degree of stake to be divested by government and LIC will be chosen at the time of structuring of transaction in assessment with RBI, Union Federal government stated in a press release.
LIC's Board likewise passed a resolution to the result that LIC may minimize its shareholding in IDBI Bank through divesting its stake along with tactical stake sale imagined by the federal government with an intent to relinquish management control and by taking into consideration cost, market outlook, statutory stipulation and interest of policy holders, Cabinet Committee on Economic Affairs stated in a statement.
Life Insurance Coverage Corporation of India's board had in 2018 authorized acquisition of as much as 51 per cent stake in IDBI Bank consequently helping the then debt-ridden state-owned bank get a capital assistance of Rs 10,000 crore- Rs 13,000 crore.
Previously this week, IDBI Bank's net revenue more than tripled to Rs 512 crore compared with Rs 135.39 crore during the very same duration in 2015.
Huge jump in IDBI Bank's earnings began account of negative arrangements worth Rs 1,119.65 crore for non-performing assets and improvement in operating earnings, majorly driven by increase in non-interest income, the bank said in a financier discussion.
IDBI Bank shares ended 4.4 percent greater at Rs 38 ahead of government's announcement of strategic stake sale in the bank.