Government to allow foreign funds over 51% of ownership in IDBI Bank

7 Dec 2022 , 11:08 AM

It will allow a consortium of foreign funds and investment firms to own more than 51 percent in IDBI Bank, according to a government clarification due on Tuesday. Department of Investment and Public Asset Management clarified that the foreign ownership criteria apply to new private banks and do not apply to existing banks.

Further, the Government of India and the RBI may also consider relaxing the five-year period for shares if any NBFC is merged with IDBI Bank, the Department of Investment and Public Asset Management said in response to queries from stakeholders.

All these clarifications came ahead of the December 16 deadline for submitting expressions of interest for a majority stake in IDBI Bank. The bank is one of the few lenders the government is trying to divest, where LIC and the government together hold 94.71% and want to sell 60.72%.