Equitas seeks to merge holding company with small finance bank

Both the promoter entity EHL and Equitas Small Finance Bank are listed connected the banal exchanges and EHL holds a 81.98 % involvement successful the bank.

Equitas Small Finance Bank (ESFB) connected Saturday said the Reserve Bank of India (RBI) has permitted the Chennai-headquartered slope to use to the banking regulator for support of its strategy of amalgamation, that volition facilitate the merger of the promoter entity Equitas Holdings (EHL) with the bank.

In accordance with the RBI tiny concern slope licensing guidelines and the RBI clarification issued connected January 1, 2015, a promoter of tiny concern slope tin exit oregon to cease to beryllium a promoter aft the mandatory archetypal lock-in play of 5 years, depending connected the RBI’s regulatory and supervisory comfortableness and marketplace regulator Sebi regulations successful this respect astatine that time.

In the lawsuit of ESFB, the said archetypal promoter lock-in expires connected September 4, 2021, and the slope had requested RBI if a strategy of amalgamation of the promoter and holding company, EHL, with the bank, resulting successful exit of the promoter, could beryllium submitted to RBI for approval, anterior to the expiry of the said 5 years.

Both the promoter entity EHL and Equitas Small Finance Bank are listed connected the banal exchanges and EHL holds a 81.98 % involvement successful the bank.

“Accordingly, we would beryllium initiating steps to finalise the strategy of amalgamation, taxable to the boards of the slope and EHL for support and instrumentality further enactment thereafter successful accordance with applicable regulations and guidelines,” it said.

ESEB, successful a regulatory filing said that RBI successful a connection connected July 9, 2021, has permitted the slope to use to RBI, seeking support for strategy of amalgamation. RBI had besides conveyed that immoderate ‘no-objection’, if and erstwhile fixed connected the strategy of amalgamation, would beryllium without prejudice to the powers of RBI to initiate action, if any, for usurpation of immoderate licensing guidelines oregon immoderate presumption and conditions of license, oregon immoderate different applicable instruction.