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All India Bank Officers' Confederation (AIBOC), the apex organisation of officers in the banking industry, has objected to the RBI's decision to open ASBA-designated branches on Sunday, May 8 to facilitate LIC IPO subscription.

According to the statement by the AIBOC, "the subscription for the LIC IPO was opened on May 4, 2022, and on the second day of bidding the IPO is subscribed 1.03 times, with policyholders bidding for 3.11 times, staff 2.21 times, and retail investors 93%. With the closing date being on May 9, 2022 and 4 days still remaining for bidding, we fail to fathom out the reason for the RBI Notification for opening the Branches on Sunday".

The union added that when there is the extensive usage of the online subscription among investors then why the RBI is asking them to open branches on Sunday.

Most of the branches are ASBA (Application Supported by Blocked Amount) designated with rapid digitisation.

"Considering extensive usage of online subscription of IPO among the investors, we are of the considered view that most of the branches will not get even a single application on Sunday in the physical format. In such circumstances, the decision to keep open all the bank branches is per se farcical and banks cannot afford to bear such humongous expenditure," AIBOC said in a statement.

While the DIPAM has been over-enthusiastic in asking branches to work on a holiday, it said, the RBI has not assessed the actual requirement to keep all the branches open.

The decision will not yield any result but rather impose a huge financial burden which is estimated to be more than 100 crore on account of employee compensation and other operational costs to keep the branches open on a holiday, it said.

Considering all these aspects, the RBI should review its decision and recall its order of opening branches on Sunday, the union added.

On May 4, the Reserve Bank of India had directed banks that all ASBA-designated branches will remain open to the public on Sunday to facilitate the processing of applications for LIC’s initial public offering (IPO).

State-owned LIC's IPO, the country's biggest-ever offer, closes on May 9.

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