INSUBCONTINENT EXCLUSIVE:
The RBI accepted 21 of the 33 recommendations of the internal working groupReserve Bank of India (RBI) has refrained from allowing the
corporate ownership of banks, putting on hold the recommendations from its internal working committee - that said large corporate and
industrial houses may be allowed to promote banks after amendments to the Banking Regulations Act, 1949.The central bank has also not
accepted the recommendation to allow well-run, large non-banking financial corporations or NBFCs, including those owned by a corporate
The RBI on Friday said that both suggestions are under examination.The initial recommendations by the internal working group were - allowing
well-run large NBFCs with an asset size of Rs 50,000 crore and above, including those owned by corporate houses, may be permitted to convert
to banks provided they complete 10 years of operations and meet the due diligence criteria.However, the central bank has allowed promoters
to retain a 26 per cent shareholding in banks, higher than the current cap of 15 per cent
The move will benefit leading private lenders such as Kotak Mahindra Bank and IndusInd Bank, among others, which have been seeking more time
money to begin a bank as the RBI has accepted all the recommendations on the minimum initial capital requirement for licensing new banks,
saying for universal banks the initial paid-up voting equity share capital required for a new bank, may be increased to Rs 1,000 crore from
recommendations of the internal working group and said that the remaining suggestions are under its consideration
