DBS Group Holdings Limited is Southeast Asia’s one of the largest lenders. The lender has however recently reported that it is facing lawsuits related to its takeover of Lakshmi Villas Bank.
Lakshmi Villas Bank was a struggling local bank in India which is currently at 4.79% on NSE.
The equity shares and the Tier-2 bonds written before the amalgamation faced legal actions against the DBS’s local unit.
The Singaporean lender quoted in a Bloomberg report regarding this amalgamation against its unit operating in various Indian high courts.
DBS completed this acquisition on November 27 as reported by the company.
DBS has however no incremental unprovided risks pursuant to these lawsuits. It also said that the other legal liabilities have also been appropriately provided for the normal business course.
Also, apart from these events, the Chief Executive Officer of DBS Piyush Gupta is expecting the bank to become profitable.
The CEO of DBS Piyush Gupta also quoted that Lakshmi Villas Bank will soon become profitable by next 12 to 14 months.
The Singapore based bank has set aside the amalgamation expenses and also the allowances for the sourced assets.
Moreover, it was the first time that the Reserve Bank of India requested a foreign lender for the bail of a local bank. Further, Indian financial industry has suffered a shock series ever since the banking crisis in 2018.
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