Now, RRBs can raise funds in capital mkt
Govt issues draft guidelines for listing of RRBs; Minimum net worth of Rs300 cr and CAR above the regulatory minimum level of 9% during previous 3 yrs are mandatory
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New Delhi: In a bid to enable regional rural banks (RRBs) to raise resources by listing on stock exchanges, the government has issued draft guidelines that set certain basic criteria, including net worth of at least Rs 300 crore during the previous three years.
They should also have capital adequacy ratio (CAR) above the regulatory minimum level of 9 per cent in each of the preceding three years. The RRBs should have a track record of profitability and earned operating profit of minimum Rs15 crore for at least three out of the previous five years, according to the draft guidelines issued by the finance ministry recently. Besides, there should not be any accumulated loss and the lender should have given return on equity of minimum 10 per cent in three out of the preceding five years, it said.
As per the draft norms, the responsibility of identifying suitable lenders for issuing initial public offering (IPO) has been left with the respective sponsor banks.
