RBI relaxes restrictions on HDFC Credila regarding onboarding of new customers
The Reserve Bank of India (RBI) has relaxed restriction on onboarding of new customers by HDFC Credila on Tuesday. The relaxation was granted to HDFC Bank after the lender met RBI‘s condition that the application for change in the shareholding of HDFC Credila as a non-banking finance company be made to the central bank before July 31, 2023, according to the filing. The RBI had also asked for the shareholding of HDFC Bank in HDFC Credila to be brought down to 10% on or before March 31, 2024.
HDFC Limited, India’s largest housing finance company, saw its stock price close at ₹2,762.50 apiece on 27 June 2023, up by 1.59% from the previous day’s close of ₹2,723.15 apiece.
The Board of Directors of HDFC Limited has given its approval to the Scheme under Sections 230 to 232 of the Companies Act, 2013, and related regulations. However, the implementation of the scheme is subject to obtaining various statutory and regulatory approvals.
In a previous letter dated April 21, 2023, HDFC Bank had informed about its requests to the RBI (Reserve Bank of India). The RBI, in response through a letter dated April 20, 2023, provided certain relaxations and clarifications to HDFC Bank. One of the relaxations granted by the RBI allowed HDFC Bank to maintain its stake in HDFC Credila, a subsidiary of HDFC Limited, provided the shareholding is reduced to 10% within two years from the Effective Date. Additionally, HDFC Bank was not allowed to onboard new customers.
HDFC Bank has now issued an intimation dated June 27, 2023, to the stock exchanges. According to the intimation, the RBI, through its letter dated June 27, 2023, has relaxed the restriction on onboarding new customers by HDFC Credila. However, this relaxation is subject to certain conditions. HDFC Bank is required to submit an application for a change in the shareholding of HDFC Credila as a non-banking financial company (NBFC) to the RBI before July 31, 2023. Furthermore, HDFC Bank must bring down its shareholding in HDFC Credila to 10% on or before March 31, 2024.
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Updated: 27 Jun 2023, 11:00 PM IST
