NBFC shares zoom up to 18 pc

The panel also suggested the conversion of big non-banking finance companies into banks. The Reserve Bank of India had constituted an Internal Working Group (IWG) on June 12, 2020, to review extant ownership guidelines and corporate structure for Indian private sector banks.

Shares of non-banking finance companies on Monday zoomed up to 18 per cent after an internal RBI panel suggested the conversion of big NBFCs into banks. Ujjivan Financial Services shares jumped 18.43 per cent, Equitas Small Finance Bank rose by 12.84 per cent, Bajaj Holdings & Investment gained 8.15 per cent, Shriram Transport Finance Company 4.32 per cent and Bajaj Finance 1.95 per cent on the BSE.

An internal RBI panel has proposed that large corporates may be permitted to promote banks after necessary amendments to the Banking Regulations Act, as well as raising the cap on promoters' stake in private sector banks to 26 per cent. The panel also suggested the conversion of big non-banking finance companies into banks.

The Reserve Bank of India had constituted an Internal Working Group (IWG) on June 12, 2020, to review extant ownership guidelines and corporate structure for Indian private sector banks. The central bank made the report public on Friday and has sought comments by January 15, 2021 "before taking a view in the matter". Further, well run large NBFCs with an asset size of Rs 50,000 crore and above, including those owned by a corporate house, may be considered for conversion into banks - subject to completion of 10 years of operations and meeting due diligence criteria and compliance with additional conditions specified in this regard, it suggested.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)