Bandhan Bank<\/a> cases, it was timely for RBI to review its guidelines. He told FE, \u201cGiven that the bank ownership norms have been subject to scrutiny by courts, it is time to review bank ownership and shareholding guidelines in its entirety. However, they should have constituted a larger committee including external members and invite public comments for its recommendations.\u201d<\/p>\nThe development gains significance in light of the year-long legal battle which ended in January this year, with the RBI allowing Uday Kotak, the promoter of Kotak Mahindra Bank, to bring his stake down to 26% by August 2020 while capping his voting rights at 15%.<\/p>\n
As per the existing shareholding norms, a private bank\u2019s promoter must bring down his stake in it to 40% within three years of its launch. Thereafter, the promoter stake must be further reduced to 20% within 10 years and to 15% within 15 years.<\/p>\n
The bank has also been asked to cap promoters\u2019 voting rights at 15% of the paid-up equity share capital (PUVESC) from April 1, 2020. The promoter has been barred from buying any further \u2018paid up voting equity shares\u2019 till their shareholding falls to 15% of PUVESC. Earlier,the RBI had asked the lender to trim the promoter shareholding to 20% of paid-up capital by December 31, 2018, and 15% by March 31, 2020.<\/p>\n
The other terms of reference for the committee will include examining and reviewing the eligibility criteria for individuals and entities to apply for banking licences and to make recommendations on all related issues. The committee will also study the current regulations on holding of financial subsidiaries through non-operative financial holding company (NOFHC) and suggest the manner of migrating all banks to a uniform regulation in the matter, including providing a transition path.<\/p>\n
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