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Big IDBI Bank Update: Six-year wait ends as privatisation enters crucial phase with financial bids
The successful bidder will be required to secure final approval from the Reserve Bank of India, which will assess the buyer under its fit and proper criteria.
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The plan to privatise IDBI Bank was first announced in the Union Budget presented in February 2020. (Image: File/ANI)
Reported By: Ambarish Pandey
Written By: Shrishti Bisht
Updated: Fri, Feb 06, 2026
09:34 PM IST
09:34 PM IST
New Delhi, ZeeBiz WebDesk
The Department of Investment and Public Asset Management has received financial bids for the strategic disinvestment of IDBI Bank, moving the long-pending privatisation process into its next phase. The DIPAM Secretary said in a post on X on Friday that the bids will now be examined in line with the prescribed evaluation mechanism.
Financial Bids have been received for the Strategic Disinvestment of the IDBI Bank. They will be evaluated as per the prescribed procedure. pic.twitter.com/QizHOJfihg
— Secretary, DIPAM (@SecyDIPAM) February 6, 2026
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The Union government and the Life Insurance Corporation of India together hold close to 90 per cent stake in IDBI Bank. The two entities plan to sell a combined 61 per cent holding, which would lead to a transfer of management control. Under the proposed transaction, the Centre will divest its 30.48 per cent stake, while LIC will reduce its holding by 30.24 per cent.
The sale is estimated to generate around Rs 33,000 crore for the government, making it one of the largest divestment exercises in the banking sector.
A long road since the 2020 Budget
The plan to privatise IDBI Bank was first announced in the Union Budget presented in February 2020. Progress remained slow over the years due to the Covid-19 pandemic, evolving regulatory requirements and procedural delays. With most approvals now in place, the government is aiming to complete the transaction by March 31, 2026, within the current financial year.
The IDBI Bank sale is expected to play a key role in meeting the Centre’s broader monetisation goals. The Union Budget has set a target of Rs 80,000 crore to be raised through disinvestment and asset monetisation in FY27, and proceeds from this transaction are likely to form a significant part of that amount.
Clearances still needed before closure
The successful bidder will be required to secure final approval from the Reserve Bank of India, which will assess the buyer under its fit and proper criteria. In addition, regulatory clearances will be needed from statutory authorities, including the Competition Commission of India. As per takeover regulations, the incoming owner will also have to make an open offer to IDBI Bank’s minority shareholders.
Regulatory hurdles addressed
To smoothen the divestment process, the Centre and LIC have sought permission to relinquish their promoter status in the bank. The Securities and Exchange Board of India has also been approached to grant IDBI Bank an exemption from minimum public shareholding norms, which require listed companies to maintain a 25 per cent free float.
What this means for stakeholders
A change in ownership could lead to improvements in operations, technology adoption and service delivery for customers. Investors may see increased activity in the bank’s shares as expectations build around better governance and efficiency. For the government, the proceeds will support infrastructure spending and other development priorities.
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Shrishti Bisht
Shrishti Bisht
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