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Vikram Pandit to head JM Fin's banking foray
Bangalore, May 16, 2013, DHNS : 23:08 IST
Former Citigroup chief Vikram Pandit is likely to head a new bank proposed by the integrated financial services group JM Financial which will apply for a banking license under the prescribed RBI guidelines, the company said on Thursday.
In a filing to the exchanges, JM Financial said that as per the decision of its board of directors, Pandit will be nominated as non-executive chairman of the proposed bank.
Pandit is also likely to make investments in the banking venture.
Pandit, who is of Indian origin, has made a strategic investment in JM Financial which has issued over 1.16 crore warrants worth about Rs 22.6 crore to him, JM Financial said.
"I continue to believe in the long-term growth prospects of India," Pandit said in a statement on Thursday. "I have known Nimesh and JM Financial for over two decades and believe that, given the opportunity, JM Financial can provide the banking and financial services that the country needs."
JM Financial Group Chairman Nimesh Kampani said, "We are very excited to have Vikram as a strategic investor," adding that his organisation and Pandit have known and worked with each other extensively for many years since the early days of the growth of financial services in India.
Kampani said that he and Pandit share similar values and expressed confidence that their association would create strong domestic financial services businesses with global best practices and reach.
Pandit and partner Hari Aiyar, who will take a joint 3 per cent equity stake in JM Financial, will also have the right to purchase shares up to the amount prescribed by RBI in the proposed bank, JM Financial said.
Further deepening Pandit’s strategic connections with JM Financial, the latter will expand its lending and financing businesses by issuing $100 million in capital to global funds raised and managed by a firm led by Pandit. JM Financial will nominate Pandit as non-executive chairman of this NBFC.
Pandit, who made an unceremonious exit from Citigroup Inc in October last year after disagreements with its board of directors, will also set up a "distressed asset fund" along with JM Financial, on initial capitalisation of $100 million.