The Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi, approved the strategic sale of a 60. 72 per cent stake in IDBI Bank on 14 October 2026. The buyer is a Canadian entity of Fairfax Financial Holdings, and the transaction is valued at roughly ₹52,878 crore. The government holds 30. 48 per cent of the lender and the Life Insurance Corporation holds 30. 24 per cent, and both are selling in full to reach the combined block.
Authorities described the deal as the largest foreign direct investment ever in India’s financial sector and the biggest disinvestment since the Air India sale. Union minister Ashwini Vaishnaw said the government and LIC will together retain about 34 per cent in the restructured entity. The process took around five years: in-principle approval came in May 2021, bids were received from Fairfax and Emirates NBD in early 2026, and talks stalled in March when offers fell short of the reserve price. Fairfax later improved its offer to ₹81 a share, up from ₹75 the year before. Control of the bank will pass to Fairfax once regulatory approvals are secured, and the buyer must also make an open offer to minority shareholders. Fairfax already owns a stake in CSB Bank and has to either merge it with IDBI or exit that holding within two years.
DIPAM’s secretary said completion is targeted before the end of the current financial year. IDBI Bank shares fell by about 7. 5 per cent in early trade on 15 October after the announcement. Analysts see the deal as a possible template for privatising other state-controlled banks.