Bandhan Bank not allowed to open new branches: RBI

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Bandhan Bank cannot open any more branches as it does not meet the pre-requisites for licensing. The Reserve Bank of India apart from laying down restrictions on the bank also seized the remuneration of CEO Chandra Shekar Ghosh.

As stated by Bandhan Bank,“RBI has communicated to us that since the bank was not able to bring down the shareholding of NOFHC to 40%…general permission to open new branches stands withdrawn and the bank can open branches with prior approval of RBI and the remuneration of the MD & CEO of the Bank stands frozen at the existing level, till further notice,” 

The bank commenced its operation as a universal bank in 2015 after getting RBI’s approval. It failed to comply with the shareholding norms. The bank in its statement further added, “The bank said it is taking steps to comply with licensing condition to bring down the shareholding of NOFHC in the Bank to 40% and shall continue to engage with RBI in this behalf.” reported Live Mint.

As per its data on the website, the bank is headquartered at Kolkata and owns 937 branches across India. In 2014, RBI gave conditional approval to the micro finance institution for transformation into a universal bank.

In the Friday trade, Bandhan Bank’s share dropped 0.78% to close at ₹565.

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