All-India Bank Officers’ Association (AIBOA) has urged the Insurance Regulatory and Development Authority of India (IRDAI) to intervene in the proposed sale of Life Insurance Corporation of India’s (LIC) stake in IDBI Bank, contending that ‘any transaction at a price substantially below expected long-term return on the investment’ could adversely affect policyholders.In a representation to the IRDAI, S Nagarajan, General Secretary, AIBOA, recalled that, through its letter INV/LIC/LR/002/2018-19 dated July 4, 2018, the regulator had permitted LIC, as a special case, to acquire 51 per cent ofequity shares of IDBI Bank, subject to certain conditions.Policyholder interestsAmong the key conditions, the organisation pointed out, was the requirement that the interests of policyholders be safeguarded. LIC was also required to make all efforts to maximise returns from the transaction so that returns were commensurate with the average returns from its overall investments.According to the representation, LIC holds 529,41,02,939 equity shares of IDBI Bank, acquired in 2018 at a price of around ₹61 per share. The AIBOA has questioned whether a proposed sale at around₹82 per share, as indicated in media reports, would adequately meet the regulatory condition relating to maximising returns.Value of sharesThe AIBOA argued that, after nearly eight years since investing, value of shares should have risen substantially if benchmarked against the broad return expectations from LIC’s investment portfolio. It has therefore sought clarification on whether the proposed valuation adequately protects the interests of policyholders. It also expressed concern that any loss arising from sale of IDBI Bank equity at an inadequate valuation could ultimately have implications for policyholders, including through possible impact on future bonuses.Future of IDBI bankThe representation also places the issue in the larger context of public-sector banking. Describing IRDAI as committed to the principle of safeguarding national financial institutions and the interests of savers, the AIBOA urged it to examine the proposed transaction from both the policyholders’ interest and the future of IDBI Bank as a public-sector institution. It appealed to the regulator to intervene before any final decision on stake sale, arguing transaction should satisfy conditions under which LIC was originally permitted to acquire control bank.Public sector ownership“The interests of policyholders must be protected and every effort should be made to secure an appropriate return on LIC’s investment,” it said, while also urging that IDBI Bank continue under public-sector ownership. The representation concludes by seeking IRDAI’s cooperation and intervention in what the AIBOA describes as a matter involving policyholder interest and future ownership structure of a significant financial institution. Published on August 24, 2026