Page 23 - Banking Finance December 2017

PRESS RELEASE

Resolution of large cases will help IDBI Bank come out of red

Resolution of the large cases that have gone to the bankruptcy court will be the key enabler for the government owned
IDBI Bank to come out of red, said M K Jain, CEO of IDBI in an exclusive interview with ET. The bank, which reported
highest ratio of bad loans of 25% reported Rs 198 crore loss in the second quarter of this fiscal year. In the corresponding
quarter last year the bank had reported net profit of Rs 55 crores however in June 2017 quarter the losses were much
higher at Rs 853 crores.
The Reserve Bank of India has initiated prompt corrective action on IDBI Bank after it saw a sharp rise in bad loans while
the government replaced the Chief Kishor Kharat with M K Jain, who has more years to go before retirement.

IDBI Bank to sell entire stake in NSDL

Capital starved IDBI Bank is selling its entire 30 per cent stake in National Securities Depository Limited (NSDL) as part
of its plans to monetise non-core investments to raise resources.NSDL is promoted by IDBI, the National Stock Exchange
(NSE), and the Specified Undertaking of the Unit Trust of India (SUUTI).
The public sector lender has roped in ICICI Securities to advise and manage the process of divestment of its 12 million
shares (30 per cent of NSDL's paid-up capital).
NSDL, the first and largest depository in India, was established in August 1996, and has developed infrastructure of
international standards since. It handles most of the securities held and settled in dematerialised form in the Indian
capital market.
NSDL, on a consolidated basis, posted a net profit of Rs 99.98 crore on total income of Rs 252.1 crore in 2016-17. Its net
profit stood at Rs 97.4 crore on total income of Rs 184.51 crore the previous year, according to data on the NSDL website.
IDBI Bank has been selling non-core investments of late. The bank has already sold a 5 per cent stake in the Clearing
Corporation of India Ltd (CCIL) and a sizable stake in the Small Industries Development Bank of India (SIDBI). The public
sector entity, however, has not disclosed the amount it raised from the transactions.
It has also postponed the sale of remaining 2.5 per cent stake in the CCIL in the hope of getting a better valuation. While
the bank had sought expressions of interest (EOIs) for this stake till September 25, it has now extended the date till
October 13.
IDBI Bank management says strike failed, union claims success

The two day nationwide strike by IDBI Bank officers and other staff ended on Wednesday, with a union leader dubbing
it a "resounding success" and a seniorbank official terming it a "total failure". The unions of both IDBI Bank officers and
staff went on a strike on Tuesday and Wednesday in support of their demands.

"The employees' response to the strike call was great. A majority of employees participated. Normally, in a day, around
250,000 transactions are done by all branches of IDBI Bank. This number was drastically affected due to the strike,"
Vithal Koteswara Rao A.V., General Secretary of the All India IDBI Officers Association (AIIDBIOA) told IANS.The bank
has 1,926 branches and around 17,000 employees, including officers and other staff.
According to Rao, only a small number of employees did not participate in the strike.Wage revision for IDBI Bank staff
from November 1, 2012, to October 31, 2017, is due on the lines of similar settlements in all other banks.
In the case of all other banks, not only has wage revision been settled in May 2015 with effect from November 2012, but
also negotiations for the next wage revision due from November 1, 2017, are underway.
"Out of the 1,926 branches, 1,330 were operational during the strike. Banking transactions at those branches were not
affected. Cheque clearance was also not affected," IDBI BankExecutive Director G.A. Tadas told IANS.He said going by
the number of branches functioning for two days, the strike was a failure.
However, he was unable to tell the number of transactions carried out during the strike period compared with normal
working days. Tadas said the management was open to negotiations with the unions to settle the wage issue.

BANKING FINANCE | DECEMBER | 2017 | 23

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