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Shares of IDBI Bank jumped as LIC is set to buy a stake in the state-owned lender. The stock jumped as much as 5.6 per cent to Rs 57.95, its highest in nearly a week.
Life Insurance Corporation of India is all set to become a knight in shining armour for the ailing IDBI Bank. In a first-of-its-kind transaction, the Insurance Regulatory and Development Authority of India (IRDAI) has approved a proposal allowing the former to acquire a majority stake in the bank.
The approval, which allows for a one-time exemption to LIC to step up its stake in IDBI Bank, was taken at the meeting of the IRDAI board on Friday.
IDBI Bank was not immediately available for comment. IDBI Bank had said on Friday its board had not discussed capital injection by LIC.
Nearly 16.6 million shares change hands as of 0426 GMT, compared with the 30-day average of 17.7 million shares.
(With inputs from Reuters)
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