Consortium of foreign firms can own over 51% in IDBI Bank

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MUMBAI: The government will allow a consortium of foreign funds and investment firms to own more than 51% in IDBI Bank, according to an official clarification issued on Tuesday.
The current guidelines of the Reserve Bank of India (RBI) restrict foreign ownership in new private banks. The central bank’s residency criteria for promoters applies only for newly setup banks and would not apply to an existing entity like IDBI Bank, the department of investment and public asset management (Dipam) said in a response to interested bidders’ queries. “The residency criteria would not apply to a consortium consisting of funds investment vehicle incorporated outside India,” it said.

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The government and the RBI would also consider re-laxing the five-year lock-in period for shares if a non-banking financial company is merged into IDBI Bank, it said. The clarifications come ahead of a…

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