The Government of India is planning to list at least five Regional Rural Banks (RRBs) on the stock exchange by the end of the financial year 2026–27 (FY27). This move is part of a broader strategy to strengthen the credibility and financial health of RRBs, improve their operational efficiency, and ensure better public accountability.
<>Key Highlights of the RRBs Listing Plan:
1. Current Status of RRBs:
• Following the latest amalgamation effective from May 1, there are now 28 RRBs operating across 26 states and 2 Union Territories.
• These RRBs collectively have over 22,000 branches and serve 700 districts nationwide.
2. Objective of Listing:
• The government aims to position RRBs as credible and valuable institutions for both stakeholders and investors.
• Public listing is expected to:
• Enhance public accountability.
• Enable RRBs to operate more efficiently.
• Help raise additional capital for growth and sustainability.
3. Government’s Supportive Measures:
• Plans are underway to conduct soft skill training for RRB staff to improve service quality and professionalism.
4. Expert Views:
• According to Krishnan Sankarasubramaniam, former MD & CEO of Punjab & Sind Bank:
• IPOs are crucial for the long-term survival of RRBs.
• Listing will bring increased accountability and enable professional management.
5. Eligibility Criteria for RRBs to List (as per Finance Ministry’s 2022 Draft Guidelines):
• Minimum net worth of ₹300 crore.
• Capital Adequacy Ratio (CAR) above 9% for each of the last three financial years.
• Operating profit before tax of at least ₹15 crore in three out of the last five years.
• Minimum Return on Equity (ROE) of 10% and Return on Assets (ROA) of 0.5% in three out of five preceding years.
• The RRB must not be under the RBI’s Prompt Corrective Action (PCA) framework.
6. Official Response:
• An email query to the Ministry of Finance regarding the plan went unanswered as of press time.
