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RBI proposes rules for new bank licenses, invites comments

Mumbai, Aug 11 (IANS) The Reserve Bank of India (RBI) said Wednesday it plans to issue new banking licenses after discussing minimum capital requirements, ownership and foreign shareholding norms with various stakeholders.

The RBI issued a discussion paper, seeking views of stakeholders on various issues such as minimum capital requirements for new banks and promoters contribution, minimum and maximum caps on promoter shareholding and other shareholders, and foreign shareholding in the new banks.

The paper seeks views on the subject of entry of new banks in the private sector.

The central bank also sought views on whether industrial and business houses could be allowed to promote banks and should non-banking financial companies be allowed conversion into banks or to promote a bank.

It invited views and comments of banks, non-banking financial institutions, industrial houses, other institutions and the public on these.

In his budget speech on Feb 26 this year, Finance Minister Pranab Mukherjee had announced that the government might issue more licenses to private sector banks.

‘After receiving feedback, comments and suggestions on the possible approaches discussed in this paper and detailed discussions with the stakeholders, comprehensive guidelines for licensing of new banks would be framed and applications invited for setting up new banks,’ the RBI said in a statement.

The central bank will set policies after receiving feedback from different stakeholders by Sept 30.

— Indo-Asian News Service

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