Tata Group among 26 applicants for new bank licences
01 July 2013
The Reserve Bank of India (RBI) today announced the names of 26 applicants who have applied for new bank licences. The list includes Tata Sons Ltd, the holding company for India's largest conglomerate; L&T Finance, the financial arm of engineering giant Larsen and Toubro; Aditya Birla group firm Aditya Birla Nuvo; Reliance Capital, controlled by billionaire Anil Ambani and a host of others in the financing and non-financing sectors.
Others include Religare Capital Markets Ltd, IDFC Ltd, Indiabulls Financial Services Ltd, Magma Fincorp Ltd, microlender Bandhan and some lesser known companies such as Ishra Finance.
The department of post and some state-run entities like LIC Housing Finance have also applied for bank licence.
This will be the third set of licences RBI is issuing after the central bank issued licences to 12 private banks in two rounds earlier.
Muthoot Finance Ltd, the country's largest gold loan company, said on Monday that it had applied for a banking licence.
According to RBI's 22 February guidelines, the new banks will have to maintain a minimum capital adequacy ratio, or ratio of capital to risk-weighted assets, a measure of financial strength, of 13 per cent for the first three years.
Also, new banks need to list their shares on stock exchanges within three years of starting operations, up from one year previously.
In the first stage, the applications will be screened by RBI, following which they will be referred to a high-level advisory committee.
The decision to issue in-principle approval for setting up a bank will be taken by the RBI following the recommendations of the committee.
RBI announced the list of applicants after the deadline for receiving applications for new bank licences ended at 5;45 pm today (1 July).
RBI had, in February, issued guidelines for allowing corporate houses to set up banks, as part of an effort to expand access to financial services in rural and unbanked areas of the country.
RBI is expected to finalise the list of winners of new bank licences by the last quarter of the 2013-14 financial year.
The names of the applicants are:
- Aditya Birla Nuvo Ltd
- Bajaj Finserv Ltd
- Bandhan Financial Services Pvt Ltd
- Department of Posts
- Edelweiss Financial Services Limited
- IDFC Limited
- IFCI Limited
- Indiabulls Housing Finance Limited
- India Infoline Ltd
- INMACS Management Services Limited
- Janalakshmi Financial Services Pvt Ltd
- J M Financial Limited
- LIC Housing Finance Ltd
- L & T Finance Holdings Limited
- Magma Fincorp Limited
- Muthoot Finance Limited
- Reliance Capital Limited
- Religare Enterprises Limited
- Shriram Capital Limited
- Smart Global Ventures Pvt Ltd
- SREI Infrastructure Finance Limited
- Suryamani Financing Company Limited
- TATA Sons Limited
- Tourism Finance Corporation of India Limited
- UAE Exchange & Financial Services Ltd
- Value Industries Limited
It may be recalled that while issuing the guidelines for licensing of new banks in the private sector, the RBI had indicated that in order to ensure transparency, the names of the applicants will be placed on its web site after the last date of receipt of applications.