RBI starts IDBI Bank sale process, Government will get 300 billion rupees

- Advertisement -

The Reserve Bank of India (RBI) has begun evaluating at least five potential bidders interested in picking up a majority stake in state-owned IDBI Bank Ltd.

Kotak Mahindra Bank, Prem Watsa-backed CSB Bank and Emirates NBD are among those that have submitted expressions of interest, two of the people said, speaking on condition of anonymity because the talks are confidential.

The RBI, Finance Ministry, IDBI, Kotak Mahindra Bank, CSB Bank did not respond to requests for comment. A spokesperson for Emirates Bank declined to comment.

- Advertisement -

The stake sale in the lender is the first major divestment across state-owned banks as part of a broader privatisation plan and could fetch the government 300 billion Indian rupees ($3.66 billion) at the current market valuation.

The federal government owns 45.48% of IDBI Bank, and is looking to divest a 30.48% stake in the bank, alongside state-owned Life Insurance Corp of India (LIC), which will sell 30.24% from its 49.24% holding in the bank.

Expressions of interest – the first step in the stake sale process – closed in January. The potential bidders have since begun due diligence on the bank, according to the people, who added financial bids were likely to be placed later this year.

- Advertisement -

The RBI is also conducting a “fit and proper evaluation”, including extensive background and financial checks on the potential buyers, a crucial step before an investor is allowed to pick up a stake in a local bank, the people added.

Potential investors have raised questions around the extent of government control in IDBI Bank after the divestment since it will retain a 15% stake and LIC, a government company, will have a 19% stake, two of the people said.

“The government does not intend to have any management control,” one of the people said. “The government will take a call if a written submission to that effect is needed.”

- Advertisement -

Share this article...

Comments

LEAVE A REPLY

Please enter your comment!
Please enter your name here

More News...

Latest

Video: Federal Bank launches its new ‘Rishta Anthem’

Video: Federal Bank launches its new 'Rishta Anthem'

Indian Money in Swiss Banks decreases by 70%, Check how much money is still in Swiss Banks

Indian Money in Swiss Banks decreases by 70%, Check how much money is still in Swiss Banks

Gang Arrested for Rs.120 Crore Fraud from AKTU Bank Account

Gang Arrested for Rs.120 Crore Fraud from AKTU Bank Account

Rs.20,000 crore Bank Fraud, ED starts investigation

Rs.20,000 crore Bank Fraud, ED conducts Raids

Case Registered for Threatening Bank MD in Almora

Case Registered for Threatening Bank MD in Almora

ICICI Bank Manager Absconds After Duping Customers of Rs 80 Lakh

ICICI Bank Manager Absconds After Duping Customers of Rs 80 Lakh

DFS held review meeting of Gramin Banks, Check meeting highlights

DFS held review meeting on performance and upgradation of RRBs, Check meeting highlights

Case of Illegal Withdrawal of Money from Union Bank of India Branch

Case of Illegal Withdrawal of Money from Union Bank of India Branch

Bank of Baroda Employee Found Dead after Fainting on Road

Bank of Baroda Employee Found Dead Under Suspicious Circumstances

Bank of Maharashtra Fraud: Customer submitted fake property documents for Loan

Bank of Maharashtra Fraud: Customer submitted fake property documents for Loan

Latest News