The Reserve Bank has allowed IndusInd Bank to incorporate a wholly-owned subsidiary for the amalgamation of micro-lender Bharat Financial Inclusion (BFIL) with the bank.
IndusInd Bank in a filing to BSE said the RBI has, vide a letter dated June 8, 2018, "conveyed its approval for incorporation of a wholly-owned subsidiary of the bank, as part of the amalgamation of BFIL with the bank".
Earlier on Tuesday, IndusInd Bank and Bharat Financial Inclusion, formerly SKS Microfinance, had informed that that they had got approval from stock exchanges for their proposed merger, paving the way to file the draft scheme of amalgamation.
The bank had received the RBI's no-objection to the merger proposal on March 13, 2018. It received approval from the Competition Commission of India for the proposed merger on December 19, 2017.
"The scheme remains subject to approval from the National Company Law Tribunal shareholders, creditors of BFIL & the bank," IndusInd Bank said.
BFIL in a separate filing too said that the RBI has conveyed its approval for incorporation of a wholly-owned subsidiary of IndusInd Bank for its amalgamation.
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The bank will acquire BFIL through an all-stock transaction.
As on March 31, 2018, IndusInd Bank had 1,400 branches, and 2,203 ATMs spread across 713 geographical locations of the country.
Catering mainly to the economically weaker sections of the society, BFIL has presence across 16 states covering one lakh villages.