New Delhi: IDBI Bank today informed the stock exchanges that its board has granted in-principle approval to divest the bank’s entire 19.18% stake in Asset Reconstruction Company (India) Ltd (ARCIL). The sale would comprise 62.32 million shares of the lender.

Avenue India Resurgence Pte Ltd, the Indian unit of the US-based investment firm Avenue Capital Group, in March became the largest ARCIL’s largest shareholder, acquiring 27% stake in the company from six of its shareholders. These included IDFC Bank, South Africa’s FirstRand Bank Ltd, Quiveo Enterprises Ltd, Lathe Investment Pte Ltd (a subsidiary of Government of Singapore Investment Corporation Ventures), Karur Vysya Bank Ltd and Barclays Bank Plc.

The bank, now majority owned by Life Insurance Corporation of India Ltd, earlier this week sought bids from ARCs, banks, non-banking financial companies (NBFCs) and other financial institutions to sell 20 non-performing loans worth 9,756 crore, according to a notice on its website.

IDBI Bank has amongst the highest non-performing assets for a bank in the country. Its net NPA ratio improved to 8.02% as the end of June quarter from 18.76% a year ago. Net NPAs fell to 10,963 crore from Rs29,981 crore last year.

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