HSBC, a foreign lender is likely to get approval from regulator Reserve Bank of India to acquire selective assets of the Indian operations of Royal Bank of Scotland but with added clauses to the deal.
The regulator had earlier refused to give its nod to the deal. It is expected that RBI will most probably accept the idea of portfolio sale of RBS' assets to HSBC, but however will not allow the automatic transfer of RBS' branches to HSBC.
"The uncertainty seems to have cleared. We expect the deal to go through, but with certain riders. This could lead to renegotiation on the pricing," said an investment banker having information of the proceedings.
"RBS, which had acquired 31 branches in the country when it bought out the ABN Amro Bank NV's Asian operations in 2007, had decided to retain five branches and surrender the remaining to the RBI," added the banker. "Following this, HSBC would have to apply for fresh licences. They could be granted branch licences in locations like Moradabad and Panipat, where HSBC does not have a presence."
"The RBI supervisory board discussed the details of the transactions and evaluated the regulatory aspects of the deal at its Jaipur meeting in October," said a source.