The shares of Chennai-headquartered Equitas Holdings and Bengaluru-headquartered Ujjivan Financial Services took a beating on Friday after the RBI said they have to comply with the small finance bank (SFB) licence norms that require them to list their banking subsidiaries within three years of start of operations.

Shares of Equitas Holdings closed at ₹99.05 apiece, down 23.34 per cent, while those of Ujjivan Financial Services ended at ₹181.15, down 17.62 per cent, on the BSE. Market players say these companies are attracting holding company discount. Even as these companies are required to list their banking subsidiaries, the RBI guidelines require them to maintain the promoter shareholding in the banks at a level of at least 40 per cent, for a period of five years from the date of commencement of business of their SFBs.

Both SFBs have been advised to comply with all the requirements of the RBI Guidelines for Licensing of Small Finance Banks dated November 27, 2014.

According to RBI guidelines, Equitas SFB has to be listed by September 4, 2019, and the promoter has to maintain their shareholding in the bank at 40 per cent at least, for a period of five years from the date of commencement of its business, i.e., by September 4, 2021.

Ujjivan SFB has to list by January 31, 2020, and the promoter has to maintain its shareholding in the bank at 40 per cent at least, for a period of five years from the bank’s date of commencement of business, i.e., by January 31, 2022.

Equitas Holdings said it will approach the RBI for an approval to merge with the bank at an appropriate time, post the lock-in period of five years.

Ujjivan Financial Services said subsequent to the listing of its bank and closer to January 2022, the company will approach the RBI to consider its merger with the bank.

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