New Delhi [India], August 20 : The shares of IndusInd bank surged more than 2.67 per cent after the bank received approval from the Reserve Bank of India (RBI) to establish a wholly-owned subsidiary for undertaking the asset management business of Mutual Funds, the bank informed the exchange in a filing.
The approval was communicated to the bank via a letter dated August 19, 2024. It also marks a significant step in the bank's strategic expansion into the asset management sector.
"This is to inform that the Reserve Bank of India vide letter dated August 19, 2024, has accorded its approval to the Bank for setting up a wholly owned subsidiary to undertake asset management business of Mutual Fund along with infusing equity capital in the said asset management subsidiary, subject to the additional conditions as set out in the said letter" said the Bank.
According to the information by the bank as part of this initiative, IndusInd Bank is also authorized to infuse equity capital into the new asset management subsidiary. This move aligns with the bank's broader goal of diversifying its financial services portfolio and enhancing its presence in the asset management domain, a sector experiencing robust growth in India.
However, the RBI's approval is accompanied by certain additional conditions, which the bank is required to adhere to, though the specifics of these conditions have not been disclosed.
The establishment of the asset management subsidiary will allow IndusInd Bank to directly manage and offer a variety of mutual fund products, providing a comprehensive suite of investment options to its customers.
The share of IndusInd Bank was trading at Rs 1383 after surging Rs 35 at the time of filing this report.
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