How Do I Start A Bank

I have completed my PG degree and want to start my own business planning to open a bank looking for details related to this. Will you please tell me what are the considerations to open a bank and how much time it will take for open a bank please provide all details related to this?

[Pathak]

Starting a bank involves a long organization process that could take a year or more, and permission from at least two regulatory authorities.

The basic criterion for a NBFC (non banking financial company) to become a private sector bank is to have a proper track record.

There are some other considerations:

The company’s minimum net worth should be INR 200 crore. The figure will be increased to 300 crore rupees three years after the company has been transformed to a bank
The track record of the company should be absolutely perfect in accordance with the directions and regulations of the RBI. Their record for repaying the public deposits should be absolutely fine. There should be no defaults.
The company should not be backed by a major industrial organization or controlled or owned by any public authority such as local, central, and state governments
The company’s capital adequacy should be at least 12 percent and its minimum net NPA should be 5%.
The minimum latest credit rating of the NBFC should AAA.

These NBFCs also need to comply with the RBI guidelines in the following areas:

Lending to priority sector
NRI equity participation
Promoters' contribution
Foreign equity participation
Lock-in period for contributions made by the promoters
Relationship with promoters and investors
Diluting the promoters' shares once it crosses the minimum specified limit

Starting a bank in the United States costs between $500,000 to $1 million.

You will need a group of experienced bankers that pass an FBI background check and finally you will need to show that you have $10 to $30 million in capital to get your bank underway.

Starting a bank offshore costs between $150,000 to $250,000 and requires $1 million in capital, depending on the jurisdiction.

Requirements to open bank:


(A) Full name, date and place of birth, nationality, permanent address, and occupation;
(B) Notarized copy of photo identification document (such as a passport or driving license);
(C) Where that individual does not have the above identification document, – Notarised copy of that individual’s full birth certificate, where a notary has verified that copy; and
(1) A passport photograph of that individual, with the full name of that individual, the signature of
an identifier, and the date of that signature set out at the back of the photograph; and
(2) A letter signed by the identifier setting out the identifiers full name, date and place of birth,
and permanent address (the identifier can be a friend or work colleague of that individual and
has personally known that individual for more than 12 months)