The All India Officers' Association of IDBI Bank on Monday moved the Delhi High Court against the government's decision of diluting its stake in the bank to below 51 percent.

Currently, the central government owns 85.96 percent stake in IDBI Bank as per the June shareholding.

The petition prayed that the regulatory authorities be directed not to give their nod to the LIC to raise its stake to 51 percent and buying the additional 43 percent.

The important arguments that the council for IDBI Bank employees put forth are: First, acquisition of 51 percent stake by LIC in IDBI Bank is ultra vires of the Industrial Development Bank Act. They also say that the acquisition is not in public interest as it corrodes LIC's ability to payback its policyholders.

The council also said that LIC acquiring 51 percent stake in IDBI Bank will result in IDBI Bank losing the ‘public sector bank’ status, which will impact the employment of all these employees.

Government diluting stake in IDBI Bank is contrary to what the union finance minister in 2013 had said before the parliament, where they had clearly said that in no situation shall the government dilute its stake in the bank below 51 percent, the council said.

The matter will be heard on August 28 before the Delhi High Court.

First Published:Aug 27, 2018 7:53 PM IST