INSUBCONTINENT EXCLUSIVE:
NEW DELHI: The Reserve Bank of India (RBI) is open to the idea of Life Insurance Corporation of India (LIC) taking over staterun IDBI Bank,
said a senior official aware of informal discussions between the regulator and the government on the matter.
The official said the central
bank has indicated its willingness to clear any such deal provided the insurer reduces its stake in conformity with existing
give LIC enough time to pare its stake in the lender over the next few years once the debt-laden lender is on stronger footing.
The
Insurance Regulatory and Development Authority (IRDA) has already cleared a 51% stake acquisition in IDBI Bank by LIC
The insurer holds 10.82% stake in the bank and is expected to raise its stake through acquisition of fresh equity.
LIC is now expected to
hiving off of physical assets of the bank into a separate entity before any deal.
Another senior official said IDBI Bank has real estate
assets worth about ?7,000 crore and selling these to a private entity at current valuations will be a lossmaking proposition for the
bad-loan situation improves and valuations rise.
