MUMBAI: Even as the decks are being cleared for the proposed IDBI-LIC stake buyout deal, about 400-500 bank employees opposing the move have called for a week-long strike starting next Monday.
When contacted, IDBI officials declined to comment, but sources said the bank management was in dialogue with the employees union, requesting them to call off the strike.
IDBI employees and bank employee unions are opposing the proposed dilution of government stake below 51 per cent, citing that such a move gives the government room to privatise. Two, the move could also trigger staff rationalisation by re-introducing voluntary retirement schemes, as was done in 2003, when IDBI transformed itself into a banking entity.
“If the deal gets through, the government will be going back on its word given in the Parliament in 2003 to not reduce the issued capital below 51 per cent. We will take up this issue when the Parliament session begins on July 2018,” said C H Venkatachalam, General Secretary, All India Bank Employees Association.
Earlier this month, All India IDBI Officers’ Association too has written to the Finance Ministry opposing the proposed IDBI-LIC stake acquisition, though the latter is a state-run entity and has explicitly said it will not seek management control.
“This solemn assurance (to not reduce government stake below 51 per cent) given on the floor of Parliament forms part of the records of the Parliamentary Committee on Assurances formed the very basis for the ultimate passage of the IDBI (Transfer of Undertaking and Repeal) Bill-2002,” the association observed.
Irrespective of the IDBI-LIC deal, rationalisation appears inevitable for the ailing bank, which has been put under RBI’s Prompt Corrective Action last year.
The bank has been consecutively posting healthy operating profits. Burgeoning provisioning to NPAs and write-offs are acting as a drag on the bottom line of the bank, he said.