IDBI Bank lobs LIC offer to govt

Mumbai: IDBI Bank board on Tuesday decided to seek governement permission to go ahead with LIC's proposal to increase the stake in the nearly crippled bank to 51 per cent.

The LIC board gave its approval for the deal on Monday after getting an exemption from the regulator Irdai that made a clear it clear that its permission is contingent on submitting a roadmap to trim its holding to under 15 per cent over a period of time.

After the board meeting, the bank, which has the worst asset quality among all the banks with a 28 per cent bad loan pile, said it has received a letter from LIC on Monday expressing interest to increase its holding to 51 per cent through preferential allotment of shares or an open offer or a combination of both.

"The board decided to convey the interest of LIC to acquite the bank to the government for their decision on the matter," managing director and chief executive B Sriram said.