RBI yet to approve Lakshmi Vilas Bank-IHFL merger

Last Updated: Sun, Apr 07, 2019 20:24 hrs
Lakshmi Vilas Bank

Mumbai: Denying reports of it approving the merger of Lakshmi Vilas Bank (LVB) and Indiabulls Housing Finance Ltd (IHFL), the Reserve Bank of India has said that the merger does not have its nod so far and it would examine the proposals once it receives them from the merging entities.

The board of Lakshmi Vilas Bank on Friday had approved a scheme of amalgamation with the IHFL. Some media reports cited the presence of two RBI-nominated additional directors on the bank's board as an indirect approval by the apex bank.

"It is clarified that the merger announcement does not have any approval of the RBI at this stage. It is also clarified that presence of Additional Directors nominated by the RBI on the Board of LVB does not imply any approval of the RBI of the merger proposal," the central bank said in a statement on Saturday.

"The Additional Directors have clearly mentioned at the meeting that they have no view on the proposal," it said.

The RBI statement further noted that it would examine the proposals as per extant regulatory guidelines and directions and when it receives them from the entities concerned.

The Lakshmi Vilas Bank also issued a statement on Saturday saying the RBI nominee directors did not participate in the voting or express any views.

"The bank also wishes to clarify that the process of applying to the Reserve Bank of India is now on hand. There has been no prior informal notification to the regulator," it said.