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May 29, 2001
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Money > Business Headlines > Report May 29, 2001 |
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IDBI seeks to skirt bank pie dilution normBS Banking Bureau Industrial Development Bank of India will move the Reserve Bank of India seeking exemption from the central bank's stipulation of bringing down the promoter's stake in new private sector banks to 40 per cent. "It makes little sense to divest holding at this time when IDBI proposes to go in for universal banking," IDBI executive director T M Nagarajan said. On the roadmap for universal banking, IDBI acting CMD S K Chakraborti said the institution is yet to take a decision on whether it will merge itself into IDBI Bank or take over another bank. The institution is looking at a two-year time-frame to convert itself into a universal bank," Charkaborti said. The IDBI chief also opposed tooth and nail the government's plan of merging Industrial Finance Corporation of India with IDBI. "This will help neither IFCI nor IDBI," he said. The RBI has been putting pressure on new private sector banks to reduce promoters' holding to 40 per cent in accordance with the licensing norms. IDBI holds majority 57 per cent stake in IDBI Bank and SIDBI holds 14 per cent while the rest is with the public. IDBI is yet to apply to the RBI to convert itself into a bank. Chakrabarti said that it has appointed Boston Consulting Group to prepare the roadmap and restructure businesses to transform itself into a globally competitive universal bank, utilising the operational synergy of the IDBI group. Meanwhile, IDBI has decided that its plans to foray into the pension business is likely be merged with its mutual fund arm -- IDBI Principal Asset Management Company. "As the regulations and norms for entry into pension have yet to take shape, it will be a while before we can enter into the pension industry. In the meantime, we are in talks with a number of foreign insurance players as we intend to get into life insurance business," said Nagarajan. Powered by YOU MAY ALSO WANT TO READ:
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