IDFC Bank set for 1 October launch with a few branches
11 Apr 2015
Shareholders of IDFC Ltd have approved the scheme of arrangement between the company and IDFC Bank Ltd, thereby completing most of the conversion process and taking it closer to the launch of banking business.
Under the scheme of arrangement, each IDFC shareholder will get 1 share of IDFC Bank. The current FII holding in the company stands at 48 per cent, Rajiv Lall, CEO & MD of IDFC, said, adding that it will continue to be an important infrastructure player.
Speaking on the development, Lall said the banking operations will start on 1 October with a few branches.
The new bank will focus on three areas, including wholesale, retail and rural banking and will be a universal bank, Lall said. IDFC Bank will be the owner of payments bank.
With IDFC shareholders approving the demerger of its financial undertaking into IDFC Bank, most of IDFC to IDFC Bank conversion process has been completed. The Reserve bank of India has already granted approval for the scheme of arrangement proposed by the company..
IDFC Ltd was one of the two applicants (other being Bandhan Financial Services Private Ltd), which were given in-principle approval to establish banks on 2 April 2014.
Under the proposed holding structure, IDFC Limited, which is the current listed company, will be the parent organisation, which will own a non-operating finance holding company (NOFHC), as mandated by the Reserve Bank of India, which in turn will operate the listed bank and other subsidiaries that IDFC currently has, including the mutual fund, IDFC Alternatives, IDFC Securities and IDFC Infrastructure Debt Fund.
Lall said the total balance-sheet size of the bank is expected to be around Rs70,000 crore by 1 October.