The story of new generation banks, so far

MUMBAI/MANGALORE, FEB. 22:  The first time the Reserve Bank of India issued guidelines for new banks was two decades ago on January 22, 1993 just as the economy was opening up.

When the RBI issued guidelines, it received 113 applications, many of which were from large industrial houses. Then the RBI asked the first chairman of IDBI, Sharad Marathe, to review the applications, and then finally picked 10 applications including four that were backed by institutions.

Of the 10 which started in 1994, four didn’t survive. Three (Times Bank, Centurion Bank which had taken over Bank of Punjab) merged with HDFC Bank while another new bank — Global Trust Bank — was forced to merge with the public sector Oriental Bank of Commerce. After a lull, the RBI in 2004 once again allowed two private banks — Kotak Mahindra Bank and YES Bank.

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