Mumbai: Life Insurance Corpora-tion of India (LIC) that is planning an initial pulbic offering next month will not sell its entire stake in IDBI Bank, but would retain some stake and continue using the bank’s branch network to distribute its insurance products. LIC is also open to a second option where its subsidiary LIC Housing Finance could source loans from IDBI Bank in case a stake sale in IDBI Bank does not materialise. This would help LIC to comply with the RBI regulations that lets housing finance business to be done by only one company in a group.
“I would personally like to have a stake in IDBI Bank. It has been the strongest contributor to the bancassurance channel for us. This will help us grow that part of the channel,” M.R. Kumar, chairman, LIC told reporters at a press conference on Monday. He, however, did not state the percentage of stake that LIC would like to hold in IDBI Bank.
LIC rescued IDBI Bank in 2019, infusing Rs 4,743 crore in October 2019 while the bank further raised Rs 1,435.1 crore in December 2020 via a qualified institutional placement. While the government holds 45.48 per cent stake in IDBI Bank, LIC owns 49.24 per cent stake in the lender.
