IDBI Bank employees and pensioners have nothing to fear: DIPAM Secretary 

The service conditions of all existing employees of IDBI Bank will be fully protected in the proposed strategic restructuring of the lender, said Arunish Chawla, Secretary, Department of Investment and Public Asset Management.

"The service conditions will be fully protected. The bank also has pensioners. Their pension benefits will be protected, there is a dedicated pension fund set aside for the purpose," Chawla told BT in an interview.

Addressing concerns of bank unions and IDBI Bank employees over the sale of controlling stake in the lender, Chawla said the employees and pensioners have nothing to fear.

"The bank is being strategically restructured as a going concern. It will continue to be a board-run company and the management will continue to negotiate with the employees," he said.

Chawla said that the transaction will be completed this fiscal, and the share purchase agreement will be signed once the Reserve Bank of India gives its clearance to the bidder.

The secretary further said that the strategic restructuring of CPSEs will continue and the existing pipeline of stake sales will be taken to its logical conclusion.

Banking and insurance employee unions have opposed the Union Cabinet’s decision to sell a 60.72% stake in IDBI Bank to Fairfax Financial Holdings.

Soon after the Cabinet’s approval, the United Forum of IDBI Bank Officers and Employees opposed the proposed sale and called for a review. “The public deserves evidence that a national asset is not being transferred at a throwaway price,” it said in a statement.

The United Forum of Bank Unions, which says it represents 90% of the banking workforce and comprises seven bank unions, has described the move as not only “privatisation” but also “foreignisation”. The UFBU has asked its members to wear black badges on October 16.