Mumbai: Equitas Holding Ltd, the promoter of Equitas Small Finance Bank, on Saturday said the Reserve Bank of India has allowed it to file for a scheme of amalgamation of the promoter entity with the bank.
Currently, both Equitas Holding Ltd and Equitas Small Finance Bank are listed on the stock exchanges. Equitas Holdings holds an 82% stake in the bank.
“In accordance with Paragraph 8 of RBI Small Finance Bank Licensing Guidelines (“SFB Licensing Guidelines”) dated November 27, 2014 read with RBI clarification to Query No 101 on the SFB Licensing Guidelines issued on January 1, 2015, a promoter of Small Finance Bank (SFB) can exit or to cease to be a promoter after the mandatory initial lock-in period of five years (“Initial Promoter Lock-in”) depending on the RBI’s regulatory and supervisory comfort and SEBI Regulations in this regard at that time,” the company said in a stock exchange filing.
“In case of Equitas Small Finance Bank Limited (“the Bank”), our subsidiary for which the Company is the promoter, the said Initial Promoter Lock-in for the Company expires on September 4, 2021. Hence, the Bank had requested RBI if a Scheme of Amalgamation of the Company with the Bank, resulting in exit of the promoter, can be submitted to RBI for approval, prior to the expiry of the said five years, to take effect after the Initial Promoter Lock-in expires,” it added.
According to the filing, RBI vide its communication dated 9 July to the bank has permitted it to apply to the central bank seeking approval for scheme of amalgamation.
“Accordingly, we would be initiating steps to finalise the Scheme of Amalgamation, submit to the Boards of the Company and the Bank for approval, and take further action thereafter in accordance with applicable regulations and guidelines,” the company said.
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