Reliance Capital is taking one more shot at entering the banking sector. The Anil D Ambani Company said that Nippon, its Japanese partner in life insurance and mutual fund ventures, will participate in setting up of the proposed Reliance Bank.
The financial services entity had previously thrown its hat in the ring when the Reserve Bank of India (RBI) invited applications for established of private sector banks.
Though, the central bank received only two applications IDFC and Bandhan Financial Services in April this year.
Consequently, the RBI had come out with draft guidelines for establishing of two new categories of lenders payment banks and small banks in July this year. Although the apex bank has said that it will also issue bank licences on-tap, it is yet to come out with guidelines for continuous authorisation for universal banks.
However, Reliance Capital did not spell out the details as to which specific type of bank it would be interested in. A statement from the company only went on to say that the bank will be set up under appropriate category of licences to be issued by the RBI.
Yoshinobu Tsutsui, president of Nippon Life Insurance (NLI) said, Reliance Capital is planning to set up its own bank to cater to individual customers and small and medium enterprises all over India. NLI is also participating in this bank project as part of a strategic business alliance with a view to improving financial infrastructure and contribute towards economic growth of India .
The declaration coincided with Prime Minister Narendra Modi s first official visit to Japan, in which he invited Japanese investments and said businessmen from the two countries could give a direction to the world economy.
The Prime Minister s visit to Japan reinforces the strategic focus of global partnership between India and Japan.
Reliance Group managing director Amitabh Jhunjhunwala said, As a good role model of business partnership between Indian and Japanese corporations, Reliance Group and NLI Group will actively further expand their collaboration, which will contribute towards strengthening the relations between India and Japan .
In the meantime, Nissay Asset Management (NAM), a part of NLI Group, and Reliance Capital Asset Management has introduced two mutual funds Short Term Indian Bond Fund and India Equity Selection Fund for Japanese retail investors.
A joint statement said that the two funds will direct investments from Japanese retail investors into Indian equity and bond markets.
The India Equity Selection Fund will in a straight line invest in Indian equity markets, whereas the Short Term Indian Bond Fund will invest in permitted Indian government securities and local currency Indian corporate bonds.