In May 2017 the Reserve Bank of India put IDBI Bank under its Prompt Corrective Action framework, with restrictions on its lending because of bad loans and losses. Nine years later a foreign investor has agreed to pay ₹81 a share for its control.
The Cabinet Committee on Economic Affairs approved on 14 October a wholly owned unit of Fairfax Financial Holdings, the Toronto-based insurer, as the strategic buyer of 60.72 per cent of the bank for ₹52,878.08 crore, according to the Ministry of Finance. Fairfax puts the price at about $5.6 billion. The Ministry calls it, once completed, the largest foreign direct investment yet in India’s financial sector.
Two independent valuers, using a market-multiple method and an asset-valuation method on the 31 March 2026 accounts, put fair value at an average of ₹75.99 a share. The winning bid of ₹81 beats that benchmark by 6.6 per cent, by Blitz arithmetic, and Fairfax says it is about 23 per cent above the bank’s book value at 30 June 2026.
What India gets
The Government receives about ₹26,544 crore and LIC about ₹26,335 crore, split in proportion to the 30.48 per cent and 30.24 per cent stakes they sell. Both keep a share — 15 per cent and 19 per cent — and withdraw their nominees from the board. The Ministry’s FAQ states the larger gain plainly: the bank will raise capital without depending on government support.
What India gains: a bank recapitalised by foreign money instead of the taxpayer, about ₹53,000 crore back to the exchequer and LIC, and a signal to global investors that Indian banking is a market worth paying a premium to enter.
