asset management company, alternate funding firm and the bank.
The foreign shareholding of 53% in IDFC will need to brought below 50% within the next 18 months and to achieve this, the company will offer preferential shares to domestic investors though no investors have yet been approached.
Lall explained that the process of establishing a bank would take nine years with the first three years spent on becoming compliant with RBI guidelines as also experimenting with new approaches. The next three years would be used to consolidate IDFC’s learnings during the first phase, while the final three years would see a return to sustained growth and profitability.
Asked what the bank would be called, he said, “We are very boring people, so for now we will stick with the IDFC Bank name. But maybe crowdsourcing a new name through a competition may be a good idea.”
As on December 31, 2013, the company had a loan book of Rs 54,552 crore and its net worth stood at Rs 15,250 crore. Its capital adequacy stood at 24.8% (of which tier-I was 22.5%) and its net interest income was Rs 2,036 crore at the end of the December quarter. IDFC’s growth has been driven by the substantial investment requirements of the infrastructure sector in India, combined with the growth in the Indian economy over the last several years. Its largest shareholders include the government of India (17.2%), followed by Sipadan Investments (Mauritius) at 10%, LIC at 6.8% and RBS with 6.4%.