IDBI Bank Employees Launch Two-Day Nationwide Strike Against Privatisation Plans

More than 10,000 employees of IDBI Bank began a nationwide two-day strike on Monday to protest against the proposed privatisation of the lender, escalating intense union opposition to the central government's plan to divest its majority stake.

The industrial action, called by the United Forum of IDBI Officers and Employees, brings daily banking operations to a halt across branches nationwide. Union leaders are demanding that the government and the bank management immediately scrap the privatisation agenda, arguing that the institution's turnaround stems entirely from public funds and staff commitment rather than private intervention.

Reversing Financial Distress Through Public Capital

The bank faced severe financial stress between 2016 and 2020 after the Reserve Bank of India mandated strict asset recognition through its Asset Quality Review exercise. Heavy bad loans dragged the lender into prolonged losses.

During this vulnerable period, the Union government and the Life Insurance Corporation of India (LIC) injected over ₹46,000 crore of public capital into the bank to rescue it from collapse. Employees point out that their dedicated efforts retained nervous customers, maintained branch operations, and restored market confidence while the institution bled financially.

Strong Financial Turnaround Sparks Opposition

Union representatives argue that selling the bank now makes little economic sense given its dramatic recovery. IDBI Bank has posted cumulative net profits exceeding ₹30,100 crore over the past six years.

Asset quality metrics have also undergone a massive transformation. The gross non-performing asset (NPA) ratio plummeted from 31.78% in 2018 to a healthy 2.30%, while the net NPA ratio settled at a minimal 0.16%. Furthermore, the bank maintains robust financial buffers with a capital adequacy ratio of 26.38% and a provision coverage ratio standing at 99.31%.

Valuation Concerns and Strategic Sale Controversy

Despite these strong performance indicators, the government is moving forward with plans to transfer management control to Canada's Fairfax Group. Employee unions have strongly condemned the move, raising serious objections regarding the proposed valuation of the financial institution. The forum contends that the estimated valuation severely undervalues the bank's true market worth and asset base, while questioning the overall transparency of the strategic sale process.

The nationwide strike highlights deep-seated tensions over public sector disinvestment in India's banking sector, setting the stage for prolonged friction between organised bank unions and policymakers.

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