Emirates NBD Bank Gets RBI Nod to Set Up India Subsidiary
The Dubai-headquartered lender has been operating in India since November 2017 and currently has branches in Chennai, Gurugram, and Mumbai
Mumbai: The Reserve Bank of India (RBI) has granted in-principle approval to Emirates NBD Bank PJSC to establish a wholly owned subsidiary (WoS) in India, the regulator announced on Monday.
The Dubai-headquartered lender has been operating in India since November 2017 and currently has branches in Chennai, Gurugram, and Mumbai. The minimum start-up capital requirement for a WOS would be Rs 300 crore and the subsidiary will be required to maintain a capital adequacy ratio of 10 per cent. Emirates NBD Bank is UAE's second-largest lender.
The in-principle approval has been granted for setting up the WoS by converting its existing branches into a single subsidiary structure.
The subsidiary model offers greater operational flexibility for foreign banks operating in India than doing business here through branch banking.
Emirates NBD is one of the few foreign banks to receive regulatory clearance via the wholly owned subsidiary route. Other lenders operating in India through this model include DBS Bank India and SBM India. Foreign banks operating under the WoS framework are treated on par with domestic banks for branch expansion, exempt from requiring regulatory approvals, subject to specific conditions.