Infrastructure financier IDFC, which received a universal banking licence from the Reserve Bank of India (RBI) last year, will start banking operations from October 1. It received in-principle approval for operation in April 2014 and obtained the final approval on Friday.
Bandhan, which also received a banking licence, will start operations from August 23.
Rajiv Lall will be vice-chairman and managing director, while former Union home secretary Anil Baijal will be the chairman of IDFC bank.
Vinod Rai, former Comptroller and Auditor General of India (CAG), will be the non-executive chairman of IDFC. Lall, the current IDFC chairman, will step down, as he will be the chief executive of the banking entity. Under Rai, CAG unearthed the 2G spectrum allocation and coal scams, which rocked the previous United Progressive Alliance government and was eventually voted out of power in 2014. Rai will also be on the IDFC Bank board. Vikram Limaye will continue to be the CEO and MD of IDFC.
IDFC has three finance subsidiaries — IDFC AMC, IDFC Alternatives, and IDFC Securities. To conform to RBI guidelines, it has to create a non-operative financial holding company (NOFHC) under IDFC and the three finance subsidiaries will have to be under the NOFHC, a 100 per cent subsidiary of IDFC. IDFC will be the holding company, which will have two subsidiaries — NOFHC and IDFC Foundation.
“In lieu of the unfolding advances in technology and in the digital environment, IDFC Bank is well positioned to leverage emerging opportunities to offer a differentiated and new age banking experience,” Lall said.
While IDFC is already listed, IDFC Bank, where all IDFC assets will be transferred, will be listed from the day it starts its operations. An IDFC shareholder will get one share of IDFC Bank for every share of IDFC he holds. IDFC will have 51 per cent stake in the bank and the rest will be held by existing shareholders.