statesman news service
KOLKATA, 24 JUNE: Joining the race for banking licence, financial services firms Srei Infrastructure Finance Ltd and Edelweiss Financial Services Ltd today informed the Bombay Stock Exchange that they will apply for banking licence in accordance with the guidelines issued by the Reserve Bank of India.
"The board of directors of the company, at its meeting held on 24 June 2013, has decided to submit an application to the Reserve Bank of India (RBI) for obtaining a banking licence, based on the Guidelines for Licensing of New Banks in the Private Sector dated 22 February 2013 and the associated clarifications issued by the RBI on 3 June 2013," Srei Infrastructure Finance said in a filing to the Bombay Stock Exchange.
Edelweiss Financial Services said in its filing: "Board of directors of the company, at its meeting held on 24 June 2013, has approved a proposal for making an application to the Reserve Bank of India (RBI) for a banking licence, in accordance with the provisions of the Guidelines for Licensing of New Banks in the Private Sector dated 22 February 2013, issued by the RBI."
Meanwhile, non-banking financial company Mahindra & Mahindra Financial Services today said that the company has decided not to proceed with the application for a banking licence after reviewing the RBI guidelines in this regard.
"The current set of guidelines, as clarified, has an adverse economic and operational impact on the business of larger NBFCs," the company said in a filing to the BSE.
The company said the RBI guidelines provide for conversion of NBFCs into a bank, but do not provide any flexibility for an NBFC and a bank to co-exist for a reasonable period of time.