AU Small Finance Bank (AU SFB) on Tuesday submitted an application to the Reserve Bank of India seeking the approval for a universal bank licence.
“The bank has submitted an application to the Reserve Bank of India to seek approval for voluntary transition from a small finance bank to universal bank today i.e. on September 03, 2024,” said the bank in a filing with the BSE.
The bank’s management had earlier expressed plans to apply for a universal banking licence. In a post-earnings conference call in July, Sanjay Agarwal, managing director and chief executive officer, said the board had decided to file an application for a voluntary transition into a universal bank.
As per the April guidelines of the RBI, an SFB aiming to become a universal bank should have a minimum net worth of Rs 1,000 crore at the end of the previous quarter and its shares should have been listed on a recognised stock exchange. It should also have net profits in the previous two financial years and gross NPA and net NPA of less than or equal to 3% and 1%, respectively, for the last two fiscals.
For the quarter ended June 30, total deposits grew to Rs 97,290 crore, from Rs 69,315 crore a year ago, while advances rose to Rs 90,702 crore from Rs 63,635 crore. The SFB’s income stood at Rs 4,315 crore, compared with Rs 2,773 crore a year ago. It reported a 30% jump in its net profit to Rs 502 crore.
As far as disbursements are concerned, the Jaipur-based lender has already completed 20% of the target for the current fiscal, Agarwal said.
Shares of the bank on Tuesday closed down 1% at Rs 674.45 on the BSE.