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A unique union (BS 14.09.06) In more ways than one, the IDBI-United Western Bank deal is unique. First, the Reserve Bank of India (RBI) took 10 days to decide on who would be the right suitor for the troubled Satara-based old private sector bank. In the mergers of Global Trust Bank and Ganesh Bank of Kurundwad the suitor was chosen within 48 hours of the imposition of moratorium. Second, for the first time, the interest of shareholders has been taken care of by the prospective acquirer. Finally, the winner itself - IDBI- was a big surprise. The RBI conducted an informal bidding process for the troubled bank which has a positive net worth of around Rs 70 crore. The prospective acquirers were expected to meet certain key conditions. First among them was the protection of all depositors without any help from DICGC. Second, the regulator wanted an expeditious resolution to restore the confidence of the depositors and the lenders of United Western Bank. On this count, two foreign banks - Citi and Standard Chartered - failed as they cannot go ahead with an acquisition without conducting due diligence. Third, the RBI preferred to choose those who would not seek any forbearance in terms of statutory requirement like CRR and SLR. Fourth, the central bank also wanted an assurance on the fate of the 3,000-odd employees of the bank. Finally, it gauged the prospective acquirer’s commitment to protect the interest of United Western Bank’s shareholders. IDBI scored over others on this count by offering Rs 28 per share against a book value of around Rs 13. To this extent, United Western Bank has been awarded to the highest bidder in a well laid-out, transparent process.