IDBI Bank's board approves preferential issue to LIC, government

The board of directors of IDBI Bank on Thursday approved the proposal for preferential issue of capital to the government and Life Insurance Corporation of India (LIC).

"Board of Directors of IDBI Bank, at its meeting held on September 19, 2019, has approved the proposal for Preferential Issue of Capital to Government of India and Life Insurance Corporation of India aggregating up to Rs 4,557 crore and Rs 4,743 crore respectively," the filing read. The decision is subject to customary regulatory approvals.

Earlier on September 3, the government had approved Rs 9,300 crore capital infusion into IDBI Bank in a bid to increase the lender's capital base. Moreover, the government has announced capital infusion of Rs 70,000 crore into public sector banks (PSUs) in order to help lenders clean up their balance sheets, littered with huge non-performing assets (NPAs).

Reacting to the regulatory filing submitted, the share price of IDBI Bank declined 3% to touch the intraday low of Rs 26.95 on BSE in Thursday's trading session and ended at Rs 27.15 on BSE, registering a decline of 0.65 points or 2.34%.

source: Business today