Govt revives proposal to merge IFCI, IDBI & IIBI

The government seems to be reviving the old proposal of a mega merger between leading financial institutions. Minister of state for finance Anandrao Adsul today hinted that such a proposal is currently being considered by the finance ministry.
The current proposal is a mega merger between IFCI, IIBI and IDBI. It is learnt that while the proposal for a merger between IFCI and IIBI is being actively looked at, the merger with IDBI is still being debated.
"We have to find a way of restructuring the FIs," Mr Adsul said today at the sidelines of a book release function organised by Exim Bank. He said the proposed merger is being looked at as one of the options to restructure the ailing FIs.
The minister said the merger proposal of IFCI and IIBI was "under process". He, however, declined to give details about IDBI as the standing committee on finance was in the process of drawing up a report on the FI''s corporatisation.
Finance minister Jaswant Singh introduced a bill in the winter session of Parliament to repeal the IDBI Act and smoothen out the process of converting it into a universal bank. But the bill was referred to the standing committee on finance. The had weighed the option of a reverse merger of IDBI Bank and IDBI on the lines of ICICI Bank and ICICI. ut it was not found to be feasible as the merged entity would not be able to comply with Reserve Bank''s statutory obligations.
Meanwhile, IFCI has decided to delist from the Delhi, Kolkata, Chennai and Ahmedabad stock exchanges. With this IFCI shares will be listed only on the Bombay Stock Exchange and National Stock Exchange.