Bandhan Bank may ask RBI to relax holding company rule
While representing its case, Bandhan Bank is expected to seek RBI approval for merging the three entities-Bandhan Financial Services, Bandhan Financial Holding and Bandhan Bank
 "Graph")
premium
.
Bandhan Bank might ask the Reserve Bank of India (RBI) to relax the rule that the promoters’ stake must be brought down to 40 per cent in the holding company.
At present, Bandhan Financial Services is the 100 per cent owner of Bandhan Financial Holding, a non-operating financial holding company. Which, in turn, has promoted and owns 89.62 per cent stake in Bandhan Bank. After the initial public offering (IPO) of equity, which opens later this week, the promoter holding in Bandhan Bank will go down to around 82 per cent, from nearly 89 per cent at present.
RBI's licensing norms require any bank offering 'universal' services to bring down the promoter holding to 40 per cent. However, the Securities and Exchange Board of India's rules also call for a year's lock-in period for promoter holding after an IPO.
Bandhan Financial Services, a non-banking finance company (NBFC) and at the helm of the holding company structure, has a promoter holding of 40.73 per cent. The promoter holding here is held by two trusts-Financial Inclusion Trust at 32.91 per cent, and North East Financial Inclusion Trust at 7.82 per cent. In 2009, when Bandhan converted from a non-government organisation to an NBFC, the latter entity had issued the shares to the two trusts.
At present, Bandhan Financial Services is the 100 per cent owner of Bandhan Financial Holding, a non-operating financial holding company. Which, in turn, has promoted and owns 89.62 per cent stake in Bandhan Bank. After the initial public offering (IPO) of equity, which opens later this week, the promoter holding in Bandhan Bank will go down to around 82 per cent, from nearly 89 per cent at present.
RBI's licensing norms require any bank offering 'universal' services to bring down the promoter holding to 40 per cent. However, the Securities and Exchange Board of India's rules also call for a year's lock-in period for promoter holding after an IPO.
Bandhan Financial Services, a non-banking finance company (NBFC) and at the helm of the holding company structure, has a promoter holding of 40.73 per cent. The promoter holding here is held by two trusts-Financial Inclusion Trust at 32.91 per cent, and North East Financial Inclusion Trust at 7.82 per cent. In 2009, when Bandhan converted from a non-government organisation to an NBFC, the latter entity had issued the shares to the two trusts.