Insurance regulator IRDAI Monday said it has sought proposal from Life Insurance Corporation of India (LIC) for paring its shareholding in the recently acquired controlling stake in IDBI Bank.

Insurance Regulatory and Development Authority of India (IRDAI) stipulates that insurers are allowed to hold only up to 15 per cent stake in any listed entity. But LIC, with a special dispensation from IRDAI, holds more than the limit in some state-run banks.

North Block is worried the continued losses suffered by IDBI Bank and the erosion of LIC’s investment in the lender, made at its insistence, may force it to eventually step in with rescue capital or allow the bank to be sold off.

“The Life Insurance Corporation invested around Rs 21,624 crore in IDBI, including buying a 26 per cent stake at a price of Rs 61.73 a share. That share price has now dropped to Rs 43.10, around a 30 per cent fall in price. This is a worrying phenomenon, especially as IDBI Bank does not look like turning around anytime soon,” said officials.

With the Life Insurance Corporation of India (LIC) picking up 51 per cent stake in IDBI Bank, the lender's board wants to change its name to LIC IDBI Bank or LIC Bank.

The bank informed BSE that the board, at its meeting held on February 4, has approved a proposal for change of name of IDBI Bank.

Insurance Regulatory and Development Authority (IRDAI) has asked the insurance companies to make provision for their exposure to the beleaguered IL&FS group.

They have to make provisions for it as those exposures cannot be written off, IRDAI chairman Shubash Chandra Khuntia said on the sidelines of the release of the handbook on general insurance claim insights for policyholders by the Insurance brokers association.

The Life Insurance Corporation (LIC) on Monday became the owner of a bank when it completed the acquisition of a 51 per cent controlling stake in IDBI Bank. The insurer will have five nominees on the bank’s board, while the government will have two.

IDBI Bank is now a subsidiary of LIC after allotting 82,75,90,885 equity shares to the insurer at a price of Rs 60.73 per share, aggregating Rs 5,025.96 crore in the final tranche of the preferential issue.

IDBI Bank Monday said insurance behemoth LIC has completed acquisition of 51 per cent controlling stake in the bank, making it the lender's majority shareholder.

"The deal, conceptualised in June 2018, is envisaged as a win-win situation for both IDBI Bank and LIC with an opportunity to create enormous value for shareholders, customers & employees of both entities through mutual synergies," IDBI Bank said in a BSE filing.

The Supreme Court on Friday said it will hear next week an appeal challenging the LIC’s move to acquire 51% in the Industrial Development Bank of India (IDBI). The total value of the deal is expected to be Rs 12,000-13,000 crore.

A bench led by Chief Justice Ranjan Gogoi agreed to hear the case on January 25 after senior counsel Kapil Sibal, appearing for All India IDBI Officers’ Association, sought urgent hearing.

Global Rating agency Standard and Poor's ( S&P) on Monday said the strain on IDBI Bank to meet regulatory capital requirement has eased after Life Insurance Corporation of India infused Rs 14,500 crore as fresh capital in ailing Indian banking entity.

"We are affirming our 'BB/B' foreign currency issuer credit ratings on the bank, and the 'BB' long-term issue rating on the notes issued by the bank's Dubai branch.

Life Insurance Corporation of India (LIC) on Tuesday gave Hemant Bhargava additional charge as chairman. The announcement to appoint Bhargava, who is currently a managing director, comes after the retirement of VK Sharma on December 31.

VK Sharma was acting as LIC chairman on September 2016 and on December 2016, he took over as chairman after SK Roy resigned, nearly two years ahead of his retirement. Bhargava had taken charge as MD in February, 2017.

State owned life insurer, Life Insurance Corporation, has seen a sharp fall in its net non-performing assets from Rs 70.40 billion in March 2018 to Rs 15.80 billion as of October 31, 2018, according to the figures provided by the finance ministry in reply to a question asked by members of parliament in the Lok Sabha.

“With regard to whether there is risk in LIC’s NPAs and clearing of the NPAs, it may be noted that as per LIC’s inputs, the rising trend in LIC’s gross NPAs over the last three financial years has been reversed in the current financial year”,

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