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IDFC First Bank, the new entity formed after the amalgamation of Capital First with IDFC Bank, is set to launch operations from the New Year.
“Almost all key approvals are in place. A major approval — from the National Company Law Tribunal after the mandate from shareholders and creditors — is awaited and likely in a month,” said a person familiar with the development, adding that a filing with Registrar of Companies will be made.
“It is expected that the new merged bank will start operations from January,” said the source.
Shareholders and creditors of IDFC Bank and Capital First had approved the transaction in October and November, respectively.
On October 25, IDFC Bank had said its board has approved making an application to the Reserve Bank of India to change its name to ‘IDFC First Bank Limited’.
“The change of name would further require approvals of statutory and regulatory authorities, including the Registrar of Companies, shareholders and other stakeholders, as may be required,” it had said.
IDFC Bank and Capital First are also understood to be working on the internal functioning including restructuring and merger of its people, processes and technology. “All of it is under way right now,” said the person.
Strategy
The new bank will build on the reach of Capital First to enhance its retail business and also use model of IDFC Bank for wholesale banking, sources close to the development said.
“While it is too early to comment but IDFC First Bank is likely to have a well-rounded strategy around retail and wholesale banking,” said the source, noting that Capital First has a loan book of over ₹30,000 crore, low bad loans and a model of financing entrepreneurs in the under served areas.
Similarly, IDFC Bank has a lot of products in sectors such as working capital and foreign exchange and has also been working on its retail business, he said.
IDFC Bank and Capital First had on January 13 announced a plan to merge, subject to regulatory approval. In June, IDFC Bank had said it has received No Objection from the RBI for merger of Capital First and its wholly-owned subsidiaries Capital First Home Finance and Capital First Securities with the bank.
Post merger, Rajiv Lall, Managing Director and CEO of IDFC Bank, will take over as the non-executive Chairman of the new entity. V Vaidyanthan, Chairman and Managing Director, Capital First who is also a veteran banker, will become MD and CEO of the new entity.
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