The Reserve Bank of India (RBI) on Monday paved the way for a holding company structure for financial entities. But it was done with an important caveat — the apex bank has sought to be the sole regulator of financial holding companies (FHCs), irrespective of a bank’s presence in the holding company. FHCs will be of two types — banking and non-banking. For a banking FHC, restrictions will be imposed on expansion of non-banking businesses. RBI will be the regulator of all FHCs.
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