DBS Bank India has announced that the customers of Lakshmi Vilas Bank can continue to access all banking services, interest rates and other facilities.
DBS Bank India made the announcement on Monday after it completely and successfully amalgamated with Lakshmi Vilas Bank (LVB).
The scheme of amalgamation is under the special powers of the Government of India and Reserve Bank of India under Section 45 of the Banking Regulation Act, 1949, India, and came into effect on 27 November 2020.
In a press release issued by the DBS Bank India Limited (DBIL), the wholly owned subsidiary of Singapore-based DBS Group Holdings Ltd. said, that the “amalgamation provides stability and better prospects to LVB’s depositors, customers and employees following a period of uncertainty. The moratorium imposed on LVB was lifted from 27 November 2020 and banking services were restored immediately with all branches, digital channels and ATMs functioning as usual.”
It further said that the existing customers of Lakshmi Vilas Bank (LVB) can continue to access all banking services. The interest rates on savings bank accounts and fixed deposits are governed by the rates offered by the erstwhile LVB till further notice.
All LVB employees will continue to be in service and are now employees of DBIL on the same terms and conditions of service as under LVB, it added.
The DBS India’s team is working closely with LVB colleagues to integrate LVB’s systems and network into DBS over the coming months.
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.
Surojit Shome, CEO of DBS Bank India Limited, said, “The amalgamation of LVB has enabled us to provide stability to LVB’s depositors and employees. It also gives us access to a larger set of customers and cities where we do not currently have a presence. We look forward to working with our new colleagues towards being a strong banking partner to LVB’s clients.”
DBS Bank India Limited (DBIL) is well-capitalised and its capital adequacy ratios (CAR) will remain above regulatory requirements even after the amalgamation.
Additionally, DBS Group will inject Rs 2,500 crore (SGD 463 million) into DBIL to support the amalgamation and for future growth. This will be fully funded from DBS Group’s existing resources.
DBS has been in India since 1994 and converted its India operations to a wholly owned subsidiary (DBIL) in March 2019.
On November 17, a 30-day moratorium was imposed on the crisis-ridden LVB restricting cash withdrawal at Rs 25,000 per depositor.
The Reserve Bank of India (RBI) simultaneously placed in public domain a draft scheme of amalgamation of LVB with DBIL, a banking company incorporated in India under the Companies Act, 2013, and having its registered office at New Delhi.
LVB is the second private sector bank after Yes Bank that has run into rough weather during this year. In March, capital-starved Yes Bank was placed under a moratorium.