Equitas Holdings Ltd (EHL) and Equitas Small Finance Bank Ltd (ESFBL) on Friday received no-objection from the Reserve Bank of India (RBI) on the voluntary amalgamation of both units, the bank said.
The RBI no-objection comes with conditions. The merger is being effected to comply with the RBI norms on small finance banks, mandating the promoter to reduce the stake in the subsidiary to 40 percent within five years of commencement of operations by the SFB (Small Finance Bank).
However, RBI said the EHL must divest its shareholding in its subsidiary Equitas Technologies P Ltd prior to the amalgamation. Besides, Equitas SFB will have to seek RBI approval for bringing Equitas Development Initiatives Trust (EDIT) and Equitas Healthcare Foundation (EHF) under its ambit prior to the scheme taking effect.