RBI: Cos Need Minimum Capital of 
500 cr to Set Up a Bank
Mumbai: The Reserve Bank of India on Monday unveiled the draft guidelines on new banking licences, pegging the minimum required capital to set up a bank by a corporate at 
500 crore while limiting the foreign shareholding at 49 percent.
"The minimum capital requirement will be Rs 500 crore. Subject to this, the actual capital to be brought in will depend on the business plan of promoters," the Reserve Bank of India (RBI) said in its draft guidelines on new banking licences.
At present, the minimum capital requirement for the banking sector is 300 crore.
The draft norms said the aggregate foreign shareholding in the new bank should not exceed 49 percent for the first five years.
At present, the foreign shareholding in private sector banks is allowed up to 74 percent of the paid-up capital.
On the corporate structure, it said the new banks will be set up only through a wholly-owned non-operative holding company (NOHC) to be registered with the Reserve Bank as a non-banking finance company (NBFC) which will hold the bank as well as all the other financial companies in the promoter group.
Private sector entities or groups owned and controlled by Indian promoters, with diversified ownership, sound credentials and integrity and having successful track record of at least 10 years will be eligible to promote banks, it said.
However, entities or groups having significant (10 per cent or more) income or assets or both from real estate, construction and broking activities individually or taken together in the last three years will not be eligible to set up new banks. .
Source: PTI
500 crore while limiting the foreign shareholding at 49 percent.
"The minimum capital requirement will be Rs 500 crore. Subject to this, the actual capital to be brought in will depend on the business plan of promoters," the Reserve Bank of India (RBI) said in its draft guidelines on new banking licences.
At present, the minimum capital requirement for the banking sector is 300 crore.
The draft norms said the aggregate foreign shareholding in the new bank should not exceed 49 percent for the first five years.
At present, the foreign shareholding in private sector banks is allowed up to 74 percent of the paid-up capital.
On the corporate structure, it said the new banks will be set up only through a wholly-owned non-operative holding company (NOHC) to be registered with the Reserve Bank as a non-banking finance company (NBFC) which will hold the bank as well as all the other financial companies in the promoter group.
Private sector entities or groups owned and controlled by Indian promoters, with diversified ownership, sound credentials and integrity and having successful track record of at least 10 years will be eligible to promote banks, it said.
However, entities or groups having significant (10 per cent or more) income or assets or both from real estate, construction and broking activities individually or taken together in the last three years will not be eligible to set up new banks. .