Jana, Ujjivan can bypass promoter ring department in Universal Bank Shift

Kolkata: the requirement to rings for the final transformation of AU Small Finance Bank in a Universal Bank may not apply to Jana SFB and Ujjivan SFB If the Reserve Bank of India approves their applications, said experts who follow the sector.

These two universal banking aspirants would somehow meet this specific aspect. The Central Bank has commissioned AU SFB to set up a holding company and to submit shares of promoter as a condition for the final approval of Universal License. The supervisor offered an in-principle license last month and wants to avoid the ownership of the direct promoter at the bank in her new Avatar.

AU promoter Sanjay Agarwal with his family members and employees together have 22.85% in the bank.

Jana already has a listed holding company as a promoter, while Ujjivan, who reclaimed his holding company last year, is being held completely publicly without promoters, in accordance with HDFC Bank.

“The RBI’s framework is designed to guarantee strong governance, especially when promoters are involved. For universal banks, however, the regulations offer flexibility if a promoter is not a condition,” said NiraV Shah, MD of Equirus Capital, an investment banking and financial consultancy company.

Jana already has a non-operative holding company, Jana Holdings, which is 100% owned by Jana Capital. The holding has 21.88% in the bank, while TPG ASIA has 8.12% and the Amansa holdings of Singapore have 6.07% interest. Terhept, the group is in the advanced stages of merging these two holding companies to create a slimmer structure. Jana Capital remains operational and keeps shares of the bank after the merger, a senior official said last week. Jana Capital is the Core Investment Company and is 100% owned by Jana Urban Foundation and other investors. The Jana Urban Foundation, the primary owner of non -profit, was founded by Ramesh Ramanathan and Swathi Ramanathan.ujjivan, conversely, her holding company Ujjivan Financial Services to the bank last year.

“Our understanding is that we do not have to have a new individual holding company for a universal banking license when Promoter -Holding came to zero,” said a senior official of Ujjivan Bank.

Ujjivan applied for the Universal Bank license in February, while Jana applied for it in June. AU SFB had applied for it in September 2024. The voluntary transition would help these lenders with easier bank rules. Their requirement of capital -teeminess would amount to around 11.5% of 15%, while the target of the priority sector would be lower by 40% instead of 60%.

The standard for having at least 50% of the loan portfolio in loans of less than £ 25 Lakh would no longer apply. Moreover, the shedding of the “Small Bank” tag would improve the surf and help in mobilizing deposits, said People Abling.