LIC and the government have decided to sell their entire stake in IDBI Bank. A few months ago, the approval of the Cabinet Committee on Economic Affairs of the Modi government was received. But then it was not decided how much stake would be sold. But now it has been decided that the government and LIC will sell their entire stake.
At present, the Government of India has 45.48 percent and LIC has 49.24% percent in IDBI Bank. Actually, investment was made from LIC in IDBI Bank with a gun on the head. Three years ago in 2018, LIC had bought 51 per cent stake in IDBI by investing Rs 21,000 crore. After this, LIC and the government together gave Rs 9300 crore to IDBI Bank for the recapitalization of IDBI Bank. LIC’s stake in this was Rs 4,743 crore.
This was also done when IDBI Bank was the worst performing bank in India in terms of NPAs. At that time the gross NPA of IDBI Bank had reached 27.95%. That is, out of Rs 100, Rs 28 was turned into NPA. But then it was not sold. The savings of our blood and sweat were saved through LIC in it. And now it is being sold.
LIC itself is struggling with increasing NPAs. The NPA of the company has doubled in five years. Two years ago, LIC had said in its report that as of September 30, 2019, there is a total gross NPA of Rs 30,000 crore. Now this figure must have grown wildly. Because LIC has given huge loans to many troubled companies including DHFL Dewan Housing Finance Corporation Limited, IL&FS Infrastructure Leasing and Financial Services and Anil Ambani-led Reliance Group. This amount is said to be a total of Rs 4 lakh crore.
Forced to make similar investments, LIC Chairman SK Rai resigned in the year 2016, two years before the completion of his five-year term. Till now in the history of LIC, no chairman had resigned before the completion of his term.
