RBI lifts all restrictions on Bandhan Bank after promoter pares stake
Mumbai: Bandhan Bank on Monday said the Reserve Bank has fully withdrawn the restrictions imposed on the private sector lender for high promoter holding, nearly two years after imposing them.
The restrictions included seeking prior approvals for network expansion, and also freezing managing director and chief executive Chandra Shekhar Ghosh's remuneration.
Earlier this month, the bank's promoter Bandhan Financial Holdings sold shares worth $1.4 billion or over Rs 10,500 crore at a discount to reduce its stake by over 20 per cent to 40 per cent, the level acceptable for the regulator.
In September 2018, the RBI had imposed the restrictions, and did away with the condition of seeking approval for opening banking outlets in February this year.
The RBI, vide its communication dated August 17, 2020 has lifted the other regulatory restriction (on) 'the remuneration of the MD and CEO of the bank stands frozen, at the existing level', the bank said. Consequent to the above, all the regulatory restrictions imposed by the RBI vide letter dated September 19, 2018, on the Bank are now withdrawn, it added.
The bank had merged with mortgage lender HDFC's low-value home loan company Gruh Finance earlier, which had helped reduce
the promoter ownership to the 60 per cent level from the earlier 80 per cent.