The retail portion of the initial public offering (IPO) of Life Insurance Corporation of India (LIC) was fully subscribed on Friday, making redundant an RBI directive to keep ASBA branches open on Sunday to facilitate the issue.

The RBI on May 4 — the day the much anticipated issue opened for investors — notified that banks may keep open all their ASBA (Application Supported by Blocked Amount) branches on May 8. This was followed by a request from the Centre to keep the branches open on Sunday.

This is for the first time that such bank branches will be open on Sunday to facilitate subscription to an IPO. Usually, investors cannot bid for such issues on weekends.

Bank officers union AIBOC has objected to the RBI's decision to open ASBA-designated branches on Sunday, saying it will serve no purpose as most of the applications are filed digitally.

“Considering extensive usage of online subscription of IPO among the investors, we are of the considered view that most of the branches will not get even a single application on Sunday in the physical format. In such circumstances, the decision to keep open all the bank branches is per se farcical and banks cannot afford to bear such humongous expenditure,” the All India Bank Officers' Confederation (AIBOC) said in a statement.

Observers said that the request from the Centre may have come in the context of the huge size of the offering and the volatile market conditions that have been marked by relentless selling by foreign portfolio investors.

Although the government may be pulling all stops to make the float a success, its recommendation and the subsequent circular by the RBI may be seen as unnecessary given the strong response and that there is no greenshoe option — retaining excess subscription — in the IPO.

It is not the RBI alone which has smoothened the flow for the offering: market regulator Sebi had relaxed the rules with regard to lock-in period by anchor investors ahead of the issue.

Meanwhile, the offering continued to see better response on the third day. It witnessed full subscription of the retail segment in the early hours of the day. The portion reserved for eligible policy holders was subscribed 4.01 times, reservation for eligible employees was subscribed 3.06 times, while retail category was subscribed 1.23 times.

Similarly, the non-institutional category saw subscription of 0.76 times and the subscription from qualified institutional buyers category was of the tune of 0.56 times or 56 per cent.

The offer received bids for 22,36,98,915 shares against the offered 16,20,78,067 equity shares (excluding shares offered to anchor investors), as per the data available on the bourses.