The government-run infrastructure financing company IDFC has said the board has approved a proposal to seek license from RBI for setting up a bank and that the organization will soon move the Reserve Bank with an application, IDFC told exchanges in a filing.
The RBI has set a July 1 deadline to submit application for licence. Earlier this month, RBI while issuing clarification on new bank licence guidelines said, the entities getting licences to open new banks will be given 18 months to open branches against 12 months prescribed earlier, and promoters would have to transfer their holdings to the non-operative financial holding company in a stipulated period.
The holding company envisages holding of the bank and other regulated financial services entities of the promoters under it and prudential exposure norms for the regulated entities. The country has 26 public sector banks, 22 private sector banks and 56 regional rural banks and 43 foreign banks. Ten banks were licenced on the basis of guidelines issued in January 1993. The guidelines were revised in January 2001 based on the experience gained from the functioning of these banks, and fresh applications were invited. Of the 10 licences issued in 1993, four banks merged with other lenders over a period of time. Times Bank merged with HDFC Bank, while Global Trust Bank was amalgamated with the state-owned Oriental Bank of Commerce. Centurion Bank took over Bank of Punjab to become Centurion Bank of Punjab, which merged with HDFC Bank in 2008.
