IDBI Bank Privatisation News- After receiving the fit and proper report from RBI, now everyone’s eyes are fixed on the budget to be presented by Finance Minister Nirmala Sitharaman on May 23.
Bank Privatization: The path of privatization of IDBI Bank is now almost clear. The Reserve Bank of India has given a ‘fit and proper’ report after investigating the investors bidding for the bank. The Narendra Modi government started the process of selling the government’s stake in this bank in May 2021. Since then the central government is waiting for the green signal from the RBI. The central bank assesses whether the bidders meet the proper and appropriate criteria. It is also checked whether the bidders comply with the rules and whether they are under the surveillance of other regulators.
After getting the fit and proper report from the RBI, now all eyes are on the budget to be presented by Finance Minister Nirmala Sitharaman on May 23. The market is waiting to know what indication the government gives in the budget on disinvestment. As soon as the news of RBI giving green signal to the bidders came, today the share of IDBI Bank jumped up to 6 percent. At 11 am, IDBI Bank shares were trading at Rs 92.80, up 5.60 per cent on NSE.
No report on foreign bidder
According to a Times of India report, RBI has given its report on all foreign bidders except one. This foreign bidder did not share his information and neither did the foreign regulator provide data about him.
Government has 45.5% stake
The central government has 45.5% stake in IDBI Bank. At the same time, LIC has more than 49% stake. IDBI was earlier a financial institution which later became a bank. According to the government’s disinvestment plan, the government can sell 60.7% stake in the bank. This includes 30.5% of the government and 30.2% of LIC.
Government expected to get 29,000 crores
IDBI’s market cap is currently around 99.78 thousand crores. According to the current market valuation, the government can get more than Rs 29,000 crore by selling the stake. The government had planned to divest BPCL, Concor, BEML, Shipping Corporation, IDBI Bank and an insurance company. But there has been no progress in this direction for the last 18 months. The government has postponed the divestment of BPCL. Petroleum Minister Hardeep Puri had also confirmed this recently.
Government’s stance on disinvestment
In the last 10 years, the government has repeatedly talked about exiting sectors that are ‘non-strategic’. But so far only Air India has been disinvested. Market analysts say that there should be no problem in the privatization of IDBI Bank. They say that it is a private entity. The reason for increasing the government’s stake in it is that the government has to infuse capital in it to recover from the huge losses caused by the debt.
We have taken all measures to ensure that the information provided in this article and on our social media platform is credible, verified and sourced from other Big media Houses. For any feedback or complaint, reach out to us at informalnewz@gmail.com
