Bank Officers’ Union AIBOC Opposes Privatisation of IDBI Bank
New Delhi, August 27, 2025 – The All-India Bank Officers’ Confederation (AIBOC) has strongly opposed the Indian government’s move to privatise IDBI Bank, describing it as a betrayal of parliamentary assurances and a threat to the public banking sector.
In a statement released on Wednesday, AIBOC criticised the proposed privatisation, emphasizing that it represents not merely a sale of shares but the divestment of people’s savings and a weakening of India’s public banking network. The union highlighted the assurances given by the then Finance Minister in December 2003, who had promised Parliament that the government would maintain a minimum 51% stake in IDBI Bank at all times.
“Privatisation of IDBI Bank is not just the sale of shares, it is the sale of people’s savings, the weakening of India’s public banking network, and the betrayal of parliamentary assurances given at the time of its transformation,” AIBOC said.
The union warned that this move undermines the spirit of nation-building which requires robust public banks that prioritize service to the public over profits. According to AIBOC, public sector banks serve the interests of the people, whereas private banks mainly focus on profit maximization.
Last week, Arunish Chawla, Secretary of the Department of Investment and Public Asset Management (DIPAM), had indicated that the stake sale in IDBI Bank is expected to be completed during the current financial year. Qualified bidders are reported to have nearly completed their due diligence process.
Currently, the Government of India and the Life Insurance Corporation (LIC) jointly hold 95% of IDBI Bank, with 60.72% of this stake earmarked for sale as part of the ongoing disinvestment programme. IDBI Bank became a subsidiary of LIC from January 21, 2019, following the latter’s acquisition of over 8.27 billion equity shares. However, on December 19, 2020, IDBI Bank was reclassified as an associate company because LIC’s shareholding reduced to 49.24% due to fresh equity issuance under a qualified institutional placement (QIP).
AIBOC urged the government to immediately withdraw its privatisation proposal and instead focus on strengthening IDBI Bank through enhanced governance, accountability, and capital infusion from public financial institutions. The union also called for accelerating digital modernization of the bank and expanding its developmental role in the Indian economy.
“Nation-building requires strong public banks, not profiteering institutions. Public sector banks exist to serve the people; private banks exist to serve profits,” the union stressed.
The debate around IDBI Bank’s privatisation highlights the broader concern about the future role of public sector banks in India’s financial ecosystem and their critical role in supporting inclusive economic growth.
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