Exposure to Amtek; see 25 bps cut by RBI: IDBI Bank

IDBI Bank gained significant investor attention after Finance Miniister Arun Jaitley suggested it could be picked up as a test case if the government offered more operational freedom to state-run banks and also recast its holding in the bank. Under the current law the government is not required to hold 51 percent in the bank. However, the bank is in a spot over its exposure to troubled parts makets Amtek Auto which defaulted on repaying holders of 5-year bonds that came up for redemption on . Admitting it has a sizeable exposure to the company, Kishor Kharat MD & CEO at IDBI Bank told CNBC-TV18 it does not expect any debt to turn into non-performing loans any time soon. Kharat believes Amtek is trying to provide confidence to bond holders. On Tuesday the company indicated it is in advanced talks with various lenders to realign its debt obligations.  Kharat informed the bank has also refinanced nearly Rs 3000-4000 crore loans using the 5:25 rule.He expects the RBI to reduce rates by 25 bps and is prepared to lower base rates accordingly.