Stock advisory Company: Nabard buys 7% more in Sidbi from IDBI Bank for Rs900 crore

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The National Bank for Agriculture and Rural Development (Nabard) has bought an additional 7% stake in Small Industries Development Bank of India (Sidbi) for Rs900 crore from troubled public sector lender IDBI Bank Ltd, according to two people familiar with the matter, including Sidbi chairman Mohammad Mustafa.

This is the largest investment made by the apex rural financial institution so far and raises its total shareholding in Sidbi to 10%.

The central bank restricted IDBI Bank’s operations in May after its financial ratios worsened. The bank, which is plagued by bad loans, is trying to sell its non-core assets and had put its entire 16.25% shareholding in Sidbi on the block in August. The bank’s attempts to find potential buyers received tepid initial response initially. Last month, the bank informed the stock exchange that it sold a total of 10% stake in Sidbi.