AU Small Finance Bank shares in focus after RBI nod for universal bank transition
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Shares of AU Small Finance Bank (AUSFB) are likely to be in the spotlight on Friday, August 8, after the Reserve Bank of India ( RBI ) granted in-principle approval for its transition from a Small Finance Bank to a Universal Bank.The approval, received on August 7, marks a significant regulatory milestone and paves the way for AU to broaden its banking scope and service offerings.With this move, AU becomes the first Small Finance Bank in India to receive such an approval, reflecting its strong track record, robust governance framework, and sustained commitment to financial inclusion. The transition aligns with AU's stated goal of evolving into a full-service bank that caters to retail, business, and digital banking customers with a comprehensive suite of products.In an official exchange filing, the bank highlighted that the approval is a 'milestone shaped by purpose, perseverance, and discipline' and validates its sound business model and consistent operational performance.The RBI's decision is based on guidelines that require a Small Finance Bank to operate for at least five years, meet the required net worth and capital norms applicable to Universal Banks, and successfully undergo a due diligence process.The eligibility and framework for such transitions were detailed in the RBI's circular dated April 26, 2024, titled 'Voluntary Transition of Small Finance Banks to Universal Banks'.AU had formally applied for the transition in September 2024 and has now cleared the first regulatory hurdle with the RBI's go-ahead.'We have made history by receiving in-principle approval from the Reserve Bank of India to transition into a Universal Bank. This milestone is a reaffirmation of our purpose, perseverance, and passion,' said Sanjay Agarwal, Founder, MD & CEO of AU Small Finance Bank.'This in-principle approval acknowledges not just our ability to grow, but to grow responsibly. It is a testament to AU's strength in reaching widely, integrity in serving wisely, and resilience to shine across AU Small Finance Bank Limited Head Office - CP3-232, Industrial Area, Apparel Park, Jagatpura, Jaipur, Rajasthan, 302022 Corporate Office - 5th Floor, E-Wing, Kanakia Zillion, LBS road, Kurla West, Mumbai, Maharashtra, 400070 Website - www.aubank.in Annexure - 2 economic cycles. As we step into this new chapter, we do so with humility, responsibility, and the pride of a homegrown institution ready to serve - our people, our nation, and the vision of Viksit Bharat 2047,' he added. AU Small Finance Bank shares closed 1.3% higher at Rs 744 on the BSE on Thursday.: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
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