RBI rejects LVB-IBHFL merger approval news

MUMBAI: The Reserve Bank of India (RBI) on Friday rejected the media reports that RBI has approved the merger between Lakshmi Vilas Bank (LVB) and Indiabulls Housing Finance Limited (IBHFL).

The RBI official statement said, “It is clarified that the merger announcement does not have any approval of RBI at this stage.”

RBI said it learnt through media reports that Lakshmi Vilas Bank (LVB) and Indiabulls Housing Finance Limited (IBHFL) have made a merger announcement on April 5, 2019 with approval of their respective boards.

“It has been reported in a section of the media that the presence of two nominee directors of the RBI on the board of LVB implies RBI’s indirect approval of the proposal. It is 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. Moreover, the additional directors have clearly mentioned at the meeting that they have no view on the proposal,” the RBI statement further clarified.

The apex bank said the proposals, as and when received from these entities, will be examined as per extant regulatory guidelines/directions.

The All India Bank Employees’ Association (AIBEA) had earlier urged RBI Governor Shakthikanta Das to not allow the proposed merger of Lakshmi Vilas Bank (LVB) with Indiabulls Housing Finace Ltd (IHFL).

The central bank should instead merge LVB with one of the public sector banks, AIBEA General Secretary CH Venkatachalam had said in a letter to the RBI Governor.


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