The Union Cabinet has approved the Infusion of Rs 4,557 crore by Government in IDBI Bank. It will enable it to return to profitability and normal lending.
About:
IDBI Bank needs a one time infusion of capital to complete the exercise of dealing with its legacy book. It has already substantially cleaned up, reducing net NPA to 8% in June 2019.
LIC is at 51% and is not allowed to go higher by the insurance regulator.
Background: Following Cabinet’s approval in August 2018, LIC acquired 51% stake in IDBI Bank. Government continues to be a promoter and holds 46.46% stake. The financial parameters of IDBI Bank have improved considerably during the last one year.
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