IDBI to streamline realty holdings

The Industrial Development Bank of India Ltd (IDBI) is planning to rationalise its real estate assets as a precursor to the merger of IDBI Bank with it. IDBI has also shortlisted a few human resource (HR) consulting firms to look into the personnel side of things.

The financial institution owns residential properties and land at prime locations across the country.

It also provides accommodation to its employees on demand and the size of accommodation depends on the grade of the employee.

" We own land and buildings, office premises and machinery. We are taking stock of these as also employee benefits and would rationalise everything before the merger," said O V Bundellu, executive director of IDBI.

As a part of the process, the bank would evaluate whether these assets are useful to the organisation or not.

"Upon completion of the evaluation we would take a decision," Bundellu said. At present, the institution has no plans to sell its residential properties. "However, we are looking to sell properties that have been taken into possession following defaults by borrowers," he added.

The HR consultants will look into the changing structure, procedures and other related matters in the context of the merger, Bundellu said. They will also work on streamlining the compensation structure, he added.

An IDBI source aid that the bank is evaluating a proposal to sell its select residential properties and land holdings prior to the merger of IDBI Bank with itself.

The organisation is contemplating on the proposal as this would enable the institution save cost as some of the residential properties are unoccupied, he added.

IDBI sees an outgo of around 425 of its 2,800 employees as a part of the voluntary retirement scheme (VRS).

Following this, hundreds of flats will also be vacated. Currently the institution has to incur huge cost in the form of maintenance cost and hence the institution is considering the option of selling it, the source added.