As part of its preparation to seek a banking licence, the Anil Ambani group’s flagship Reliance Capital has said it has partnered with the Japanese financial powerhouses Sumitomo Mitsui Bank and Nippon Life strategic partners who would also pick up under 5 per cent stake each in the proposed company. Reliance Capital, which is present in slew of non-banking financial services businesses, will be the main promoter of the proposed bank, the application for which would be soon submitted to the RBI, the company said in a statement. Sumitomo Mitsui Trust Bank is one of the largest banks in Japan, while Nippon Life Insurance is among Asia's largest financial services companies and already has strategic stakes in Reliance Capital's life insurance and mutual fund units. Reliance Capital joins a host of others having firmed up their plans to enter banking, for which applications need to be submitted by July 1 with the RBI. Religare Enterprises has already announced plans to dilute promoter stake to 49 per cent to meet the eligibility criteria, while Aditya Birla group, JM Financial Srei, Travel Finance Corporation and a host of others have also lined up their plans. There are reports that Tatas are also among the interested candidates, while Mahindras have dropped their plans to seek a bank licence.
Reliance Capital said that both Sumitomo and Nippon would have 4-5 per cent stake each in the proposed bank, subject to regulatory approvals, while agreements to this effect have been signed with them. "Sumitomo Mitsui Trust Bank is amongst the largest banks in Japan and the largest institutional investor in that country," Reliance Capital CEO Sam Ghosh said, while adding it would bring in vast experience in retail and institutional banking to the new venture. Sumitomo has total assets of $400 billion, advances of $238 billion and net assets of $25 billion.
Nippon Life, also known as Nissay, is Japan's largest private life insurer with revenues of $ 71 billion, profits of $2 billion and it is also present in a host of other Asian countries and in North America and Europe.Reliance Capital is present in insurance, mutual funds, brokerage, investment banking and a host of other financial services sectors. Reliance Group also interests in telecom, power, infrastructure, media and entertainment, among others.
