New Delhi, Oct 14 (SocialNews.XYZ) Finance Minister Nirmala Sitharaman on Wednesday said the government's decision to strategically restructure IDBI Bank reflects India's continued commitment to economic reforms and financial sector transformation.
In a post on social media platform X, FM Sitharaman said the Cabinet Committee on Economic Affairs' (CCEA) approval of the restructuring was achieved under the leadership of Prime Minister Narendra Modi and would pave the way for the bank's next phase of growth through foreign direct investment while the government retains a minority stake.
"Propelled by Prime Minister Narendra Modi’s visionary leadership, India’s reform trajectory reaches another milestone today with the CCEA’s approval of IDBI Bank’s strategic restructuring," the minister noted.
She stated that after supporting the lender's turnaround over the years, the government is now enabling fresh growth opportunities by facilitating the induction of a strategic investor.
According to the minister, the move will strengthen the banking ecosystem and help banking services in India move closer to global benchmarks.
"Having supported the bank’s recovery, we are now enabling its next phase of growth through the infusion of Foreign Direct Investment while retaining a minority stake. This will not only strengthen the banking ecosystem but also help banking services surpass global benchmarks. It reinforces that India’s growth story is strong, its economy is resilient, and the government’s commitment to reform is unwavering," FM Sitharaman noted.
The CCEA earlier approved the sale of a 60.72 per cent stake in IDBI Bank to Canada Inc., a subsidiary of Fairfax Financial Holdings, for Rs 52,878 crore.
The transaction includes the sale of 30.48 per cent stake held by the Government of India and 30.24 per cent stake owned by Life Insurance Corporation of India (LIC). Following the transaction, the government will retain a 15 per cent stake, while LIC will continue to hold 19 per cent in the bank.
FM Sitharaman described the deal as a "strategic restructuring" rather than a strategic disinvestment -- highlighting that both the government and LIC will remain shareholders in the lender after the transaction is completed.
Source: IANS
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