The Videocon group’s changing stance over new bank licence application has cost its foray into the banking sector.
After sending its intention to apply for a bank licence, Videocon group subsidiary Value Industries sent a letter to the Reserve Bank of India (RBI) expressing its desire to withdraw the application. “However, thereafter the group sent a letter again withdrawing the withdrawal letter. The RBI considered all the three letters and announced that Videocon is withdrawing from the fray,” said a person familiar with the development.
“The RBI is looking at serious players who are committed over the long term. Ultimately, you are dealing with public money,” said a source.
On September 6, Videocon group chairman Venugopal Dhoot said, “There’s a serious mistake somewhere... our application for the licence stands.” However, when contacted on Wednesday, he refused to discuss about the banking foray.
It’s not clear why Value Industries sent a letter to the RBI expressing its intention to quit the banking race. The RBI refused to entertain the argument of the group about confusion of two applications — one from Videocon and another by Value Industries —from the group.