IDBI Bank's home finance subsidiary, IDBI Home Finance, which is about to be sold by the bank has received the highest bid from the Dewan Housing Finance amongst the three shortlisted bidders by the bank.

The other two bidders which are keen on buying the bank's mortgage are Tata Capital Ltd and Religare Enterprises Ltd.

A senior bank official familiar with the development informed that the board of IDBI Bank is scheduled to meet on Friday, January 23rd to "consider and approve the selection" from amongst the three shortlisted companies.

"In terms of pricing, Dewan Housing Finance has more weight than the other two companies which are in the race. However, our Board will take the decision on whom to sell," the official said.

IDBI Bank will finalize on the deal under the advice of IDBI Capital.

Initially IDBI Bank received Expressions of Interest (EoIs) from over a dozen entities from which it has shortlisted the three firms.

The wholly owned subsidiary of IDBI Bank has a loan portfolio of over Rs 2,700 crore with 18 centers across India.

The Bank has decided to sell its finance unit because it is already dealing with home loan products and it does not seem sensible to sell the same products through two separate entities. Moreover it was unable broaden its mortgage network in a field that is ruled by banking leaders like ICICI Bank, HDFC and State Bank of India.

Earlier the bank had planned to merge its subsidiary with itself but it dropped the plan owing to "problems that could arise during the integration process, primarily on the HR side."

However an announcement on the deal is likely to be made after the decision is taken in the meeting of IDBI's board. Sources close to the development said that the deal size is estimated at over Rs 300 crore.