InvestorQ : What is the gist of the proposed merger of LVB into DBS Bank?
prachi Patwardhan made post

What is the gist of the proposed merger of LVB into DBS Bank?

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sara Kunju answered.
6 months ago
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RBI has unveiled a scheme to merge Lakshmi Vilas Bank or LVB with DBS Bank. The broad contours of the proposal are up for public comments and announced after RBI imposed a 30-day moratorium on LBV and capped withdrawals at Rs.25,000.

DBS India, subsidiary of DBS Bank Singapore, will bring additional capital of Rs.2500 crore upfront, to support credit growth of the combined entity. DBS India has Regulatory Capital of Rs.7109 crore while gross NPAs were low at 2.7% with net NPAs at just 0.5%.

LVB saw steady decline in solvency after 3-years of losses eroded its net worth. LVB was put under RBI’s Prompt Corrective Action or the PCG framework in September 2019. Soaring bad assets were the big worry for LVB.

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