New Delhi, Oct. 15 -- After the government's decision to sell a 60.72% stake in IDBI Bank to Canada's Fairfax Financial Holdings, speculation is rife that India's financial services sector could see even more dealmaking as foreigners look to deepen their exposure.

The Cabinet approved the sale of a 60.72 per cent stake in IDBI Bank to Fairfax Financial Holdings on Wednesday for Rs.52,878 crore. This is India's biggest strategic disinvestment since the sale of Air India. It potentially opens a new chapter in the privatisation of state-controlled banks.

According to Bloomberg, Blackstone Inc. and other private equity firms are exploring a stake in the shadow bank IIFL Finance Ltd. Meanwhile, Japan's Mitsubishi UFJ Financial Group Inc. is ...