NEW DELHI: Finance Ministry and the Reserve Bank of India (RBI) will meet on Thursday, July 14, to discuss the strategic sales of IDBI bank, sources said. In the meeting, the officials will discuss the investors’ responses received during the road shows for the stake sale.
“Officials of the Department of Financial Services (DFS), the Department of Investment and Public Asset Management (DIPAM) and the Reserve Bank of India (RBI) will meet on Thursday to discuss the strategic disinvestment of IDBI,” the finance ministry source said.
“Finance ministry has sought certain relaxations from the central bank with regard to promoters’ shareholding, so this will be discussed along with the timeline by which the promoters’ shareholding will be brought down,” said the source.
Besides this, the ministry is also seeking relaxation in terms of holding a limit of 10% by private equity (PE) firms. After the discussion with the RBI on these issues, the ministry will take a call on the quantum of stake sale in IDBI.
“Similarly, there are certain rules as per the Securities and Exchange Board of India (SEBI) also, which may come in conflict with RBI norms. So, we need to make a synergy between both the compliance norms,” the source added. As per the RBI rules, promoters can have a minimum stake of 40% of the paid-up voting equity share capital of the private bank for the first five years.
The government and the life insurance behemoth Life Insurance Corporation (LIC) together hold a 95% stake in IDBI. The Centre announced its disinvestment plans for IDBI Bank in February 2021. It was expecting to complete the privatisation by March 2022.