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RBI receives 26 bank licence applications as deadline ends

RBI receives 26 bank licence applications as deadline ends
Tata Sons, LIC Housing Finance, Aditya Birla Nuvo, the Department of Posts, Reliance Capital and Bajaj Finserv are among the 26 private and pubic sector entities which have applied to the Reserve Bank of India (RBI) for grant of bank licences. ‘The RBI received 26 applications in all,’ the country’s central bank said after the deadline for receiving applications for bank licences expired on Monday.

The RBI had issued guidelines for ‘Licensing of New Banks in the Private Sector’ on 22 February and came out with clarifications in the first week of June. It is, however, not yet clear how many new bank licences will be issued.

Bandhan Financial Services, Edelweiss Financial Services, IDFC, IFCI, Indiabulls Housing Finance, India Infoline, INMACS Management Services, Janalakshmi Financial Services, JM Financial, and L&T Finance Holdings too have applied.

Magma Fincorp, Muthoot Finance, Religare Enterprises, Shriram Capital, Smart Global Ventures, SREI Infrastructure Finance, Suryamani Financing Company, Tourism Finance Corporation of India, UAE Exchange & Financial Services and Videocon’s subsidiary Value Industries are the other applicants.

RBI Governor D Subbarao had earlier said, ‘Our effort will be to make that judgement as transparent, as objective, as contestable as possible... I want to say that not everybody who is fit and proper will be given a (bank) licence because we expect the number of eligible applicants will be much larger than what is a meaningful number of licences we can give.’

In its clarification, the RBI had said that the entities getting a licence to open new banks will be given 18 months to open branches and promoters would have to transfer their holdings to the non-operative financial holding company (NOFHC) in a stipulated period.
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