IDFC stated on Wednesday that it had acquired permission from the Reserve Financial institution of India (RBI) to exit the IDFC FIRST Financial institution as promoters.
IDFC is the proprietor of the holding firm IDFC Monetary Holding Firm, which in flip holds 36.56 per cent stake within the financial institution. IDFC’s exit from the financial institution will point out that the holding firm may reverse merge with the financial institution, in keeping with what two small finance banks just lately introduced. If the holding firm merges with the financial institution, then IDFC might should promote its mutual funds enterprise as effectively, analysts say.
The financial institution administration was not instantly out there for touch upon the event.
IDFC introduced receiving the RBI’s approval in a notification to the exchanges. The 36.56 per cent holding of IDFC is valued at Rs 11,618 crore on the present market worth.
IDFC Financial institution acquired the licence from the RBI in 2014, and was floated in 2015. So, the five-year interval got here to an finish in October 2020. The financial institution merged with Capital FIRST in 2018 to grow to be IDFC FIRST Financial institution.
The preliminary licensing situation to IDFC was that the promoters should have a minimal of 40 per cent stake locked in for 5 years.
Lately, two small finance banks — Ujjivan SFB and Equitas SFB — stated they might reverse merge their respective holding corporations with themselves because the five-year lock-in interval expired for the promoter holding corporations.
Nonetheless, IDFC stated in its notification that it acquired permission to exit the financial institution altogether.