kmhouseindia: Tata Sons withdraws application for bank licence Wed Nov 27,2013

Saturday, November 30, 2013

Tata Sons withdraws application for bank licence Wed Nov 27,2013

By July 1,2013 the deadline to apply for banking license, RBI had received 26 applications.The RBI had, on July 1,2013 placed on its website a list of 26 applicants for new bank licences in the private sector

On September 6,2013 the RBI said that Videocon, another large conglomerate had withdrawn its application.

RBI has indicated it would roll out new bank licences by January 2014. The applicants were to be screened by RBI to ensure prima facie eligibility and then the shortlisted applications would be referred to a high level advisory committee.

The committee, headed by former RBI governor, Bimal Jalan, held its first meeting on November 1, 2013.

With barely two months left before the Reserve Bank of India (RBI) issues new bank licences, Tata Sons, led by Cyrus Mistry (pictured), has preferred to opt out of the race.

The decision comes five months after applying for a banking licence.Tata Sons said in a statement that it had evaluated the guidelines for licensing and reached a conclusion that it’s current financial services operating model best supports the current needs of Tata group’s (domestic and overseas) strategy.

“After prolonged deliberations and detailed analysis, Tata Sons has therefore decided to withdraw its application dated July 1, 2013, from the current round of licensing,” the company said in a statement on Wed Nov 27,2013

This is not the first time that a conglomerate has sounded off the unfavorable structure laid out by the RBI for new bank licences.

Earlier in June 2013 Mahindra and Mahindra (M&M) group had decided not to apply for a banking licence citing the same reason.

The list of remaining 24 players in the fray include -