RBI to issue clarifications on new bank licence norms

RBI to issue clarifications on new bank licence norms

To address the concerns of intending applicants, the Reserve Bank
today said it will issue clarifications on the final guidelines for
new bank licences.

The regulator said many entities and groups interested in joining the
banking fray have been posting queries ever since the guidelines were
made public on February 22.

"The Reserve Bank has been receiving queries from intending applicants
seeking clarifications on the guidelines on licensing of new banks in
the private sector," RBI said in a notification.

Assuring that the identity of those seeking clarifications will be
protected, the regulator invited them to write in by April 10.
However, RBI has not mentioned when it would come out with the
clarifications.

"Considering that the clarifications sought would be of wider interest
and use for all intending applicants, the Reserve Bank has decided to
post the clarifications on its website," it said.

The RBI had posted the final guidelines after almost three years of
the then Finance Minister Pranab Mukherjee making an announcement in
the Budget to allow new private banks. RBI last gave bank licences
around a decade back.

Many business houses, including the Tatas, Birlas, Mahindras, Anil
Ambani-led Reliance Capital, asset financier Shriram Capital, LIC and
India Post among others have evinced interest or are tipped to
contemplate an entry into the banking fray.

The interested parties have been given time till July 1 to apply.

Among other things, the guidelines have allowed any entity-- be it a
private or government owned-- having its roots in any sector,
including brokerages and realty, to apply for a banking licence.

The RBI, however, said it will go by 'fit and proper' criteria, which
will include having a past record of sound credentials and integrity
and financial soundness with a successful track record of 10 years,
while giving licences.

Other requirements include a initial capital of Rs 500 crore to be
brought in by the promoter.