The Reserve Bank of India on Monday announced that 26 public and private entities have applied for new bank licences. Today was the last date for submitting application for banking licence.
The entities that have applied for banking licence include Tata Sons, LIC, Aditya Birla Group, Postal Dept, Bajaj Finserv, Reliance Cap, L&T, and Indiabulls.
At present, India has 26 public sector banks, 22 private sector banks and 56 regional rural banks.
Last month, RBI while issuing clarification on new bank licence guidelines said the entities getting licences to open new banks will be given 18 months to open branches against 12 months prescribed earlier, and promoters would have to transfer their holdings to the non-operative financial holding company (NOFHC) in a stipulated period.
The NOFHC envisages holding of the bank and other regulated financial services entities of the promoters under the NOFHC and prudential exposure norms for the regulated entities.
Ten banks were licenced on the basis of guidelines issued in January 1993. The guidelines were revised in January 2001 based on the experience gained from the functioning of these banks, and fresh applications were invited.
Of the 10 licences issued in 1993, four banks merged with other lenders over a period of time. Times Bank merged with HDFC Bank, while Global Trust Bank was amalgamated with the state-owned Oriental Bank of Commerce.
Centurion Bank took over Bank of Punjab to become Centurion Bank of Punjab, which merged with HDFC Bank in 2008. (With PTI inputs)