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The Reserve Bank of India today announced its long awaited draft guidelines for new bank licences in the private sector.
The RBI has fixed the minimum capital requirement for new banks at Rs 500 crore. But the actual capital to be brought in will depend on the business plan of promoters.
The draft guidelines say that entities /groups owned and controlled by residents, with diversified ownership, sound credentials and integrity and having successful track record of at least 10 years will be eligible to promote banks. The guidelines categorically rule out licences for entities or groups that are engaged in real estate construction, broking activities.
The draft guidelines propose that the new banks will be set up through a wholly owned non-operative holding company (NOHC), to be registered as an NBFC with the RBI - which will hold a minimum of 40 per cent of the paid-up capital of the bank for a period of five years from the date of licensing of the bank.
The new bank should list its shares within two years of getting the licence.
Foreign shareholding has been capped at 49 per cent for the first 5 years.
The guidelines also stipulate that at least 50 per cent of the directors of the non-operative holding company should be independent directors. The draft guidelines were released pursuant to the announcement made by the Finance Minister in his Budget speech in February 2010.
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