Lakshmi Vilas Bank To Merge With DBS India
(20 November 2020 – India) Reserve Bank of India (RBI) has announced an amalgamation scheme to fold Lakshmi Vilas Bank (LVB) into the Indian unit of Singapore's DBS, within minutes of putting the bank under moratorium.
The proposed plan would help DBS Bank India (DBIL) to rapidly expand its presence in the country, where it only has around 30 branches. Chennai-headquartered LVB, in comparison, has a vast network of more than 550 branches and 900-plus ATMs across India.
DBIL will invest an additional capital of INR 2,500 crore (SG$ 463 million) upfront to support credit growth of the merged entity if the scheme is approved. This will be fully funded from DBS’ existing resources.
“The proposed amalgamation will provide stability and better prospects to Lakshmi Vilas Bank’s depositors, customers and employees following a time of uncertainty,” says DBS.
“At the same time, the proposed amalgamation will allow DBIL to scale its customer base and network, particularly in South India, which has longstanding and close business ties with Singapore,” the Bank adds.