by admin | May 25, 2021 | Banking, Corporate, Corporate finance, Economy, Markets, News
By Anjana Das,
New Delhi : IDBI Bank has sounded out its new owner LIC seeking another tranche of up to Rs 12,000 crore to meet its huge provisioning requirements amid mounting losses.
The fresh support is required to cover for non-performing assets (NPAs) in the January-March quarter.
Life Insurance Corporation of India (LIC) completed acquisition of 51 per cent controlling stake in IDBI Bank on January 21. The bank received total capital of Rs 21,624 crore from the insurer in the four-month period prior to formalisation of acquisition.
Recently IDBI and LIC officials met Department of Financial Services senior officials and are said to have taken up the matter of fresh capital infusion. LIC has not commented so far.
In the backdrop of capital infusion from LIC, the bank has achieved regulatory capital requirement as on December 31, 2018, and its common equity tier-1 (CET-1) capital improved to 9.32 per cent as on December 31, 2018, against 6.62 per cent a year ago.
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IDBI Bank Q3 loss has widened threefold to Rs 4,185 crore. Total income decreased to Rs 6,190.94 crore for the quarter, compared with Rs 7,125.20 crore in the corresponding quarter a year ago.
The bank’s gross NPAs shot up to 29.67 per cent of gross advances during the quarter, against 24.72 per cent in the year-ago period. However, net NPAs declined to 14.01 per cent of the total advances, from 16.02 per cent in the December 2017 quarter.
As a result, the bank’s provision for bad loan increased to Rs 5,074.80 crore in Q3, compared with Rs 3,649.82 crore a year ago.
Provisions and contingencies for the September-December period spiked 30 per cent to Rs 4,179.12 crore against Rs 3,205.56 crore in December quarter last fiscal.
Gross bad loans as a percentage of total loans stood at 24.72 per cent at end-December compared with 24.98 per cent in the previous quarter and 15.16 per cent a year ago.
IDBI Bank, with its highest NPAs, had got the maximum Rs 10,610 crore from government last year to maintain regulatory capital in January last year.
(Anjana Das can be contacted at anjana.d@ians.in)
—IANS
by admin | May 25, 2021 | Banking, Corporate, Corporate finance, News
Mumbai : IDBI Bank has said that its Board has approved a proposal to change the name of the lender to either LIC IDBI Bank or LIC Bank, subject to regulatory and shareholders’ approval.
According to the lender, its Board has approved a proposal for change of name of IDBI Bank, subject to “RBI’s no objection, name availability or reservation by MCA, shareholders’ approval through postal ballot, stock exchanges’ approval…,” the lender said in a regulatory filing to the BSE on Monday.
The development comes after LIC acquired a majority stake in the lender.
—IANS
by admin | May 25, 2021 | Banking, Corporate, Corporate Buzz, Economy, News
Chennai : The two major unions in the banking sector – All India Bank Employees’ Association (AIBEA) and All India Bank Officers’ Association (AIBOA) – on Friday announced sector wide strike on December 27 in support of wage revision in IDBI Bank.
In a joint statement issued here, the two unions said they have been taking up the matter repeatedly with IDBI Bank management and with the central government but the matter is dragging on endlessly.
Hence it has been decided to give a call for all-India strike in all the banks on December 27.
According to AIBEA and AIBOA, the United Forum of Bank Unions (UFBU) has decided to extend support for the December 27 strike.
The UFBU is an umbrella body of nine unions in the Indian banking sector.
According to the statement, the wage revision for IDBI Bank employees was due on 1.11.2012.
The IDBI Bank employees went on two-day strike in October demanding revision of wages.
—IANS
by admin | May 25, 2021 | Banking, Corporate, Corporate Buzz, Economy, News
Chennai : Employees of the IDBI Bank will strike work for two consecutive days (October 24 and 25) demanding long pending wage revision, said All India Bank Employees’ Association (AIBEA).
Wage revision for employees and officers of IDBI Bank is due for the period from 1-11-2012 to 31-10-2017 on the lines of the settlement in all other banks.
In the case of all other Banks, not only wage revision was settled in May, 2015, with effect from November, 2012, the negotiation for the next wage revision due from 1-11-2017 was also underway.
“But it is most regrettable and deplorable that the management of IDBI Bank has been delaying the issue unwarrantedly,” AIBEA said in a statement.
According to AIBEA, its units in IDBI Bank — All India IDBI Officers Association and All India IDBI Employees Association — have decided to strike work for two days in October.
“It is most unfortunate that at a time when the Bank is suffering from huge bad loans due to Himalayan mismanagement, instead of taking the entire workforce together in redeeming the Bank to better health, the management is trying to victimise and penalise the staff by denying their legitimate wage revision,” the AIBEA said.
—IANS
by admin | May 25, 2021 | Corporate, Corporate Buzz
Chennai : (IANS) The decision to strike work for four days starting March 28 by some young officers in the IDBI Bank has put even seasoned bank union leaders in a spot, who stress that there is no split in the bank officers union.
Opposing the government’s move to dilute its holding to less than 50 percent, the All India Bank Employees Association (AIBEA) and All India Bank Officers Association (AIBOA) had given a strike call on March 28.
However, a group of young officers in the IDBI Bank has called for four-day strike from March 28.
As a result, the IDBI Bank will not function for nine days since April 1 too is a holiday on account of the beginning of the new financial year.
Even the strike on March 28 did not find favour with many union leaders in the banking sector as the strike day falls on Monday following four holidays beginning from Holi and Good Friday on March 24-25.
“We make it a point to see that the strike is not called on a day preceding or following holiday (s),” a senior bank union leader told IANS on condition of anonymity.
“There is a process to be complied with before giving a strike call, like 14-day notice. Internally, the union has to discuss the matter. We found March 28 will inconvenience the public the least as there will be three working days for them to transact,” R.S. Athalye, general secretary, All India IDBI Officers Association and convenor of United Forum of IDBI Officers and Employees told IANS on Friday.
However, Athalye denied a split in the IDBI Bank officers union.
A sizeable number of officers in IDBI Bank are in their thirties and the four-day strike call seems to be a knee-jerk reaction without thinking about the repercussions.
Athalye agrees that the government’s decision to dilute its holding to less than 50 percent in IDBI Bank is a test case.
If the government reduces it’s holding in IDBI Bank successfully, it will do the same in other banks as well, he said.
“Our fight is against the government that is going against the assurances given in parliament that the public sector character of the banks will be maintained,” Athalye said.
Meanwhile, AIBEA general secretary C.H. Venkatachalam told IANS that his union has given a strike call on March 28 only in the IDBI Bank and not in other government banks.
“The strike call is only for March 28,” he reiterated.
Similarly, AIBOA general secretary S. Nagarajan told IANS that his organisation has given strike call only for March 28.
“Four days of strike seems to be premature,” he added.
He said IDBI Bank management is approaching the court to prevent the strike.
A civil court in Hyderabad in Andhra Pradesh has issued an interim injunction against the strike, Nagarajan said.
The bank management has announced that its branches would function on March 26 (Saturday) and warned of disciplinary action against those absent on that day, Nagarajan said.
Second and fourth Saturdays are public holidays for banks.
“The union has asked the management on the legality of decisions made on a public holiday. We have also asked the management as to the rationale for opening the branches on a day when clearing operations are closed,” Nagarajan said.
Senior union leaders agreed that a four-day strike call – resulting in nine days of holidays – will be counter-productive and the public will not look at their cause sympathetically.
“So what if the government banks are privatised. They have run up lakhs of crores as bad loans. The bank unions demand recapitalisation out of taxpayer’s money,” one V. Nitya told IANS.
