{"id":8916,"date":"2026-10-15T10:19:19","date_gmt":"2026-10-15T04:49:19","guid":{"rendered":"https:\/\/lakshmishree.com\/news\/?p=8916"},"modified":"2026-10-15T10:19:19","modified_gmt":"2026-10-15T04:49:19","slug":"idbi-bank-sale-gets-approval","status":"publish","type":"post","link":"https:\/\/lakshmishree.com\/news\/idbi-bank-sale-gets-approval\/","title":{"rendered":"IDBI Bank Sale Gets Approval After Four Years of Efforts"},"content":{"rendered":"\n

Fairfax to acquire 60.72% stake held by the government and LIC for \u20b952,878 crore, marking one of the largest foreign investments in India\u2019s financial sector<\/strong><\/p>\n\n\n\n

The Union Cabinet has approved the IDBI Bank sale of 60.72% stake to a Fairfax Financial Holdings-backed entity for \u20b952,878 crore, marking a major development in India\u2019s banking sector. The transaction will transfer majority ownership of the bank to the private investor, while the central government and Life Insurance Corporation of India (LIC) will continue to hold minority stakes.<\/p>\n\n\n\n

The deal marks a significant step in the strategic disinvestment process that began in October 2022. It is also among the largest foreign investment transactions in India\u2019s financial services sector.<\/p>\n\n\n\n

Government and LIC to Sell Their Stakes<\/h3>\n\n\n\n

Under the proposed transaction, the central government will sell its 30.48% stake in IDBI Bank, while LIC<\/a> will divest its 30.24% holding. Together, the two shareholders will transfer 60.72% of the bank\u2019s equity to the Fairfax-backed entity.<\/p>\n\n\n\n

Following the transaction, the government\u2019s stake is expected to decline to 15%, while LIC will retain a 19% holding. Their combined shareholding will stand at 34%.<\/p>\n\n\n\n

The government has described the move as a strategic restructuring exercise rather than a complete exit from the bank. The transaction is expected to bring a private investor into a leading role in the bank\u2019s ownership and future growth strategy.<\/p>\n\n\n\n

Four-Year Disinvestment Process Reaches Key Milestone<\/h3>\n\n\n\n

The government initiated the strategic disinvestment process for IDBI Bank in October 2022 by inviting expressions of interest from prospective buyers. However, the process faced delays as the initial bids did not meet the required reserve price.<\/p>\n\n\n\n

To determine the bank\u2019s valuation, two independent professional agencies assessed its fair value. The average fair value was determined at \u20b975.99 per share, while Fairfax submitted a bid of \u20b981 per share. The offer was subsequently approved.<\/p>\n\n\n\n

The transaction represents the culmination of a lengthy process involving valuation exercises, investor negotiations and regulatory considerations.<\/p>\n\n\n\n

Financial Performance Improves<\/h3>\n\n\n\n

IDBI Bank has made considerable progress in strengthening its financial position over the past few years. The bank faced significant asset-quality challenges in the past, prompting capital support from the government and LIC.<\/p>\n\n\n\n

Its gross non-performing asset (NPA) ratio declined from 31.78% in September 2018 to 2.32% in March 2026. During the same period, its net NPA ratio fell from 17.30% to 0.15%.<\/p>\n\n\n\n

The bank reported a net profit of \u20b99,513 crore in FY26. Its total business exceeded \u20b96.27 lakh crore as of September 30, 2026, reflecting year-on-year growth of approximately 18%.<\/p>\n\n\n\n

The improvement in asset quality and profitability provides a stronger foundation for the bank as it prepares for a change in ownership.<\/p>\n\n\n\n

Regulatory Conditions and the Road Ahead<\/h3>\n\n\n\n

The transaction remains subject to applicable regulatory requirements and completion formalities. Under the proposed conditions, Fairfax will be required to reduce its stake to 26% over 15 years. LIC will also need to bring its remaining holding down from 19% to 15% within two years of the transaction\u2019s completion.<\/p>\n\n\n\n

The new ownership structure could create opportunities to improve operational efficiency, strengthen digital banking services and expand the bank\u2019s business. However, the actual impact will depend on the new investor\u2019s strategy and its ability to sustain growth.<\/p>\n\n\n\n

For the banking sector, the deal highlights the government\u2019s continued focus on strategic disinvestment and private investment. For IDBI Bank, it marks the beginning of a new phase, with investors and customers watching how the ownership transition shapes its future performance.<\/p>\n\n\n\n

For more updates on the banking, major investment deals, IPOs and financial markets, visit the Lakshmishree investment and Securities News<\/a> section.<\/p>\n\n\n\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

Fairfax to acquire 60.72% stake held by the government and LIC for \u20b952,878 crore, marking one of the largest foreign investments in India\u2019s financial sector The Union Cabinet has approved the IDBI Bank sale of 60.72% stake to a Fairfax Financial Holdings-backed entity for \u20b952,878 crore, marking a major development in India\u2019s banking sector. The […]<\/p>\n","protected":false},"author":1,"featured_media":8917,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"set","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[52,50],"tags":[1840,1841],"class_list":["post-8916","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-daily-market-update","category-indian-market","tag-idbi-bank","tag-idbi-bank-sale"],"_links":{"self":[{"href":"https:\/\/lakshmishree.com\/news\/wp-json\/wp\/v2\/posts\/8916","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/lakshmishree.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/lakshmishree.com\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/lakshmishree.com\/news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/lakshmishree.com\/news\/wp-json\/wp\/v2\/comments?post=8916"}],"version-history":[{"count":1,"href":"https:\/\/lakshmishree.com\/news\/wp-json\/wp\/v2\/posts\/8916\/revisions"}],"predecessor-version":[{"id":8918,"href":"https:\/\/lakshmishree.com\/news\/wp-json\/wp\/v2\/posts\/8916\/revisions\/8918"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/lakshmishree.com\/news\/wp-json\/wp\/v2\/media\/8917"}],"wp:attachment":[{"href":"https:\/\/lakshmishree.com\/news\/wp-json\/wp\/v2\/media?parent=8916"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/lakshmishree.com\/news\/wp-json\/wp\/v2\/categories?post=8916"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/lakshmishree.com\/news\/wp-json\/wp\/v2\/tags?post=8916"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}