IDBI Bank, rescued by the government and state-owned LIC, has announced plans to sell its stake in its insurance joint venture IDBI Federal Life Insurance.

In a newspaper advertisement, the bank said, “JP Morgan India Pvt Ltd has been mandated to advise and manage a strategic review process for IDBI Federal Life Insurance Co Ltd which may result in, inter alia, potential divestment of all or part of the stake held by IDBI Bank in IDBI Federal Life Insurance Company.

While IDBI Bank owns 48% of the insurance company, Federal Bank and Ageas Insurance International own 26% each.

IDBI Bank has been looking for an investor for IDBI Federal Life since 2017.

Through the sale of a non-core asset, the LIC-controlled lender is trying to raise additional capital, reported Livemint.

LIC took a 51% stake in the bank in January with the government retaining 46%. The life insurance giant is set to pump INR47bn ($654m) into the bank on top of the INR200bn it had previously injected as part of the 51% acquisition deal.

The new capital injection follows approval by the Cabinet earlier this week for the infusion of additional funds totalling INR93bn by LIC and the government in IDBI Bank which is weighed down by non-performing assets.