Indian Bank was planning to merge its housing finance arm, Ind Bank Housing Ltd, with itself by March 31, and was looking for a consultant to advise it on the same, a senior bank official said on Friday.
“We are already looking for a consultant and should finalise on who it should be by end-December. We want the merger of the arm to happen in the current financial year, if all regulatory approvals fall into place,” the official said.
Indian Bank has been intent on merging its housing finance arm with itself, but has not been able to make any serious progress on that front due to various issues, including capital.
However, the official said the bank was intent on pushing through the merger this year, as it would help bolster the bank’s retail book, bringing specialist home finance employees, and also as it would help the bank with capital conservation in the long run.
In the quarter ended September 30, Indian Bank Housing reported a loss of Rs 2.2 crore compared with a loss of Rs 6.8 crore a year ago.
The last notice by the home finance company to the exchanges shows that Indian Bank held 76 per cent stake in Indian Bank Housing as on September 30.
The home finance company’s business has been hit by Indian Bank itself getting active in the home loan market, and also as the parent has access topublic deposits, helping it price its loans cheaper than the arm.
Shares of Indian Bank were up 2.5 percent at Rs 194.5 on the National Stock Exchange. Shares of Ind Bank Housing were up 4.3% at 8.85rupees on the BSE.