ICICI Bank seeks clarity on new FDI policy
The country's largest private lender, ICICI BANK, whose ownership status may alter because of the new FDI guidelines, on Tuesday, said it is awaiting a clear stance on the policy from the government.india Updated: Apr 28, 2009 12:25 IST
The country's largest private lender, ICICI BANK, whose ownership status may alter because of the new FDI guidelines, on Tuesday, said it is awaiting a clear stance on the policy from the government.
"We are awaiting clarification (issues regarding foreign bank status)," ICICI Bank Joint Managing Director Chanda Kochhar said here.
"Nothing has changed in ownership; we continue to be with same ownership for years," she said.
ICICI Bank's statement is significant in the light of the Government announcing new FDI norms, which say if indirect FDI in an Indian company exceeds 50 per cent, its investment in subsidiaries will be treated as foreign investment.
Moreover, in calculating indirect foreign investment in an Indian entity, the sum total of FDI, stake from Non-Resident Indians, American and global depository Receipts, foreign currency convertible bonds and convertible preference shares will be taken into account.
With these changes, several private sector banks may find themselves transforming their status from being 'resident entities' to non-resident entities.
The RBI and the Finance Ministry have raised issues concerning these far-reaching changes, which will throw several banks into a different regime of governance in terms of policy clearances.