The Government of India and LIC will jointly retain a 34% stake in the restructured entity.post Fairfax tarnsaction.
Currently, the Government of India and LIC together hold a combined 94.72 per cent stake in IDBI Bank.The Centre holds 45.48 per cent while holds 49.24 per cent
Fairfax owns re/insurance joint ventures including Digit General Insurance,Digit Life Insurance,and Valueattics Reinsurance Company in India
New Delhi: The Union Cabinet has approved the strategic sale and restructuring of IDBI Bank to Fairfax Financial Holdings. owned by Indian born Canadian citizen Prem Watsa, for Rs 52,878 crore.
Fairfax will pay Rs 81 per IDBI share and will acquier 60.72 per cent of the stake.
Union Minister Ashwini Vaishnaw said the move will bring fresh capital into the financial services sector, boost FDI, and create new growth opportunities for MSMEs, small industries, and entrepreneurs.
The Government of India and LIC will jointly retain a 34 per cent stake in the restructured entity post Fairfax tarnsaction.
Currently, the Government of India and LIC together hold a combined 94.72 per cent stake in IDBI Bank.The Centre holds 45.48 per cent while LIC holds 49.24 per cent.
Post Fairfax tarnsaction,the Centre will hold 15 per cent whilew LIC will have a stake of 19 per cent.Currently, IDBI Bank is the largest bancassurance partner of LIC.
The transaction, valued at more than $5 billion, would be the largest foreign investment in an Indian bank.
It is also important for the government at a time when the Middle East war has strained finances and weaker foreign inflows have pressured the rupee, said analysts.
Fairfax also owns about 40 per cent of smaller lender CSB Bank.Under Reserve Bank of India (RBI) rules, an entity cannot own and operate two separate banks.
The Canadian investor is likely to be given up to two years to either sell its stake in CSB Bank or merge it with IDBI Bank, sources said.
In June this year, the government had received revised bids from Fairfax and Emirates for the IDBI stake after lowering the reserve price for the sale.
Fairfax has been a major investor in India through Fairfax India Holdings Corporation, which had assets worth $3.8 billion as of June 30, 2026.
Its other investments include non-bank lender IIFL Capital online brokerage firm 5paisa, two insurance joint ventures and one reinsurance ventures. The re/insurance companies are Digit General Insurance,Digit Life Insurance,Valueattics – Reinsurance Company in India, which jointly set up by Fairfax Financials and Kamesh Goyal.
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