Ever wondered what is the full form of LVB? If you are a candidate preparing for a banking examination, you must have come across the term LVB. LVB stands for Lakshmi Vilas Bank.
LVB was established in 1926 by a group of 7 Karur businessmen led by Shri VSN Ramalinga Chettiar. Their mission was to meet the requirements of Karur residents who worked in industry, trading, and agriculture.
This article includes a brief history of the bank and its interesting history about its merger with DBS Bank India. Apart from knowing what is the full form of LVB, applicants will find that knowing these facts will help them in their preparation.
What is Lakshmi Vilas Bank? (Brief History)
- LVB was founded on November 3, 1926, under the Indian Companies Act of 1913. It received approval to begin operations on November 10, 1926.
- The bank acquired its banking license from RBI on June 19, 1958, in accordance with the Banking Regulations Act, 1949.
- On August 11, 1958, LVB was formulated as a scheduled commercial bank, giving it the power to operate as a full-fledged corporate bank.
- Between 1961 and 1965, LVB’s branch network expanded and developed substantially as it purchased nine other banks.
- In 1974, the bank began expanding its branch network outside of Tamil Nadu to take advantage of advances in the pan-Indian industry.
- As a result of the aforementioned expansion, divisions were formed in the neighbouring states of Karnataka, Andhra Pradesh, and Kerala as well as in important financial centres like New Delhi, Mumbai, and Kolkata. It also has other key business centres in Gujarat, Maharashtra, and Madhya Pradesh.
- In 1976, LVB was granted the status of Registered Traders in Foreign Exchange, allowing it to offer a full range of services to international traders.
- On April 5, 2019, the board of directors of LVB authorized the bank's merger with Indiabulls Housing Finance Ltd (the world's second-largest mortgage lender at the time).
Merger with DBS Bank India
Lakshmi Vilas Bank's merger with DBS Bank India was a watershed moment in LVB’s history. With effect from November 27, 2020, LVB has merged with DBS Bank India Ltd (DBIL), a subsidiary of DBS Bank, Singapore.
While DBS India has not stated if this is a long-term or temporary arrangement, analysts and LVB employees expect the LVB moniker to be retained.
The scheme of amalgamation is subject to the Government of India and RBI's special powers under Section 45 of the Banking Regulation Act, 1949, India. The regulator opted to merge the bank with DBS due to mounting pressure from increased NPAs and losses, and it was asserted that the merger would give immediate stability to LVB and protect its depositors.
The bank's shareholders, on the other hand, have filed a lawsuit to stop the merger.
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