The Reserve Bank of India has approved DSP Investment Managers Pvt. to buy 9.99% stake in Equitas Small Finance Bank.
“The proposed acquisition of shares by DSPIM would be consequent to the Scheme of Amalgamation of Equitas Holdings Limited (“Holding Company”) with the bank taking effect,” the small finance bank said in an exchange filing.
Prior approval of the banking regulator is needed for an investor to pick up more than 5% stake in a private sector lender.
DSP Investment Managers is part of the 150-year-old DSP Group. The company advises and manages capital for global clients, including sovereign wealth funds, pension funds, insurance companies, family offices, endowments, foundations and other foreign investors with regards to their investments in India.
Equitas Holdings Ltd., the parent company, is set to be merged with Equitas Small Finance Bank, after the regulator gave its approval in March. The merger will provide 231 shares of the small finance bank for every 100 shares in the holding company.
Equitas Small Finance’s net profit more than doubled from the previous year to Rs 116 crore in the quarter ended September. The bank’s gross advances stood at Rs 22,779 crore, up 20% from last year. Gross non-performing asset ratio dropped 13 basis points quarter-on-quarter to 3.82%, while net NPA dropped 14 basis points to 1.93%.