India-based Ujjivan Small Finance Bank Ltd., which went public in December 2019, is considering a reverse merger with its parent Ujjivan Financial Services Ltd. to comply with the central bank's guidelines, Bloomberg News reported Jan. 20.
As of December 2019, Ujjivan Financial Services held an 83.32% stake in Ujjivan Small Finance Bank, according to S&P Global Market Intelligence data.
Ujjivan Small Finance Bank is considering a reverse merger with its parent to bring down the parent's stake to 40%, in line with the central bank's norms, said Managing Director and President Nitin Chugh. Discussions regarding the plan have yet to take place, he said.
In addition, Ujjivan Small Finance Bank plans to expand its lending to small businesses and has identified seven such sectors where demand is high. The company is also conducting a pilot on auto financing, Chugh added.