Microfinance company Bandhan Financial Services is set to get Rs.1,600 crore equity infusion from the International Finance Corporation (IFC) and GIC, Singapore’s sovereign wealth fund.
While IFC is an existing equity holder , GIC is picking up fresh equity stake in Bandhan, which also has equity from the Small Industrial Development Bank of India (SIDBI).
Within this fiscal, Bandhan expects to pump in Rs.100 crore of own equity, taking its total base to around Rs.3,200 crore, against the existing base of Rs.1,500 crore now, and the Reserve Bank of India’s stipulation of Rs.500-crore capital requirement for a new bank.
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Bandhan has a 21 per cent capital adequacy ratio. “With the new investment, we are ready to launch a well-capitalised, robust universal bank, which can focus on building assets and managing risks competently,” Bandhan Chairman and Managing Director Chandra Shekhar Ghosh said. The bank will operate about 600 branches across India, with 10 million depositors and a loan book of close to Rs.8,000 crore. The RBI’s in-principle licence was issued in April last, and is valid for 18 months.
Bandhan is one of the two entities and the only microfinance non-banking finance company (NBFC) that received the in-principle licence to set up a new bank.
Bandhan operates in 22 States through a network of 2,022 branches catering to more than six million customers. It employs 13,800 people. The loan book stands at close to Rs.8,000 crore.
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