Mumbai: The Life Insurance Corporation (LIC), which is set to acquire a controlling stake in IDBI Bank, wants to come in as a promoter and play a bigger role. The board of IDBI Bank on Tuesday decided to seek the government's response on LIC's proposal.

On Monday, the state-owned life insurer had in a communication to the bank expressed its interest to acquire 51 per cent either through a preferential allotment or an open offer.

The IDBI Bank board, which met on Tuesday to consider the letter, decided to seek the Centre's opinion.

Speaking to reporters after the board meeting, B. Sriram, who took charge as the managing director & CEO recently, said the LIC will have a controlling stake and it wants to have promoter status. When asked about its role, the IDBI Bank chief said the insurer will have management control.

"LIC will have a controlling stake of 51 per cent, they will have a large role to play. They will have promoter status. The obvious intent is to take management control as well," Sriram pointed out.

LIC's proposal came as a surprise as it has been felt that this transaction is more of a strategic investment. However, with the insurer now coming in as a promoter, it will be subject to certain obligations. The RBI's response will be crucial and it remains to be seen if the central bank will ask the LIC to pare its holding in the bank over a period of time.

Sriram, who declined to spell out a timeline with regard to the entire transaction, said the board would meet once the green signal from the government came through. The bank will subsequently approach regulators such as the RBI and Sebi, apart from taking other approvals. He said RBI's approval will be needed for the change in promoter status.