Singapore’s DBS Bank has infused Rs2,500 crore capital in its Indian arm, DBS Bank India to support the merger with erstwhile Lakshmi Vilas Bank (LVB), said the bank in a press release on December 3.
DBS Bank India Limited (DBIL) is well-capitalised, and its capital adequacy ratio (CAR) remains above regulatory requirements after the amalgamation, the bank said.
“The amalgamation provides stability and better prospects to LVB's depositors, customers and employees following a period of uncertainty,” DBS said.
Once the integration is complete, customers will be able to access a wider range of products and services, including access to the full suite of DBS digital banking services which have won multiple global accolades, the bank said.
DBS-LVB merger was facilitated by the government and the Reserve Bank of India (RBI) through an amalgamation scheme after the Chennai-based private bank plunged into a financial crisis due to falling capital levels and high bad loans.
As per the details of the scheme, the entire paid up equity capital of the bank was written off along with Tier-II bonds. Since then, some LVB investors have moved courts against the specific provisions of the scheme.
Earlier, DBS had said all LVB customers will continue to get interest rates on savings bank accounts and fixed deposits as offered by the erstwhile LVB till further notice. Also, all LVB employees will continue in service and are employees of DBS Bank India on the same terms and conditions of service as under LVB.
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