RBI said that the bank is in violation of listing norms.
The Reserve Bank of India (RBI) has refused to extend Chennai-based Equitas Small Finance Bank’s deadline for listing. The banking regulator said that the bank cannot open new branches till further orders. The order comes at a time when the bank completed three years of operations.
RBI said that the bank is in violation of listing norms. Remunerations of MD and CEO of the bank stand frozen at existing levels. RBI response came in as reply to Equitas, the holding company of the bank, which requested for extension of the deadline for listing Equitas Small Finance Bank. “Your request for extension of timeline for listing of share of ESFB cannot be acceded to,” said RBI in a letter.
Listing of SFBs within three years of reaching net worth of Rs 500 crore is mandatory as outlined in the Guidelines of Licensing of SFBs and as communicated to the bank at the time of granting of in-principle approval and granting of licence, thereafter.
RBI said that as the bank is in violation of guidelines for licensing of SFBs, dated November 27, 2014, the bank is not permitted to open new branches till further advise. Further restrictions may be imposed if the bank fails to make satisfactory progress towards listing of its share, said RBI.