The Reserve Bank of India (RBI) has approved India's largest insurer Life Insurance Corporation (LIC) to treble its involvement successful IndusInd Bank.
Last month, the banking regulator granted support to LIC to rise its involvement successful backstage lender Kotak Mahindra Bank. (Image: REUTERS)
By Harshita Tyagi
The Reserve Bank of India (RBI) has approved India’s largest insurer Life Insurance Corporation (LIC) to treble its involvement successful IndusInd Bank. The state-owned security behemoth is present allowed to rise its involvement successful the backstage lender to 9.99 per cent. Currently, LIC holds a 4.59 per cent involvement successful the bank. “We are pleased to pass you that the Bank has received an intimation from the RBI connected December 9, 2021, that it has granted its support to Life Insurance Corporation (LIC), shareholder of the Bank, who holds 4.95% of the full issued and paid up superior of the Bank, to get upto 9.99% of the full issued and paid up superior of the Bank,” IndusInd Bank successful a regulatory speech filing connected Friday.
According to the filing, the support is valid for a play of 1 twelvemonth i.e. up to 8 December 2022. ‘The investment, if happens, volition beryllium taxable to compliance with the Master Direction connected ‘Prior Approval for Acquisition of Shares oregon Voting Rights successful Private Sector Banks’, Master Direction connected ‘Ownership successful Private Sector Banks’, regulations of the Sebi, the Foreign Exchange Management Act, 1999 and immoderate different guidelines/regulations and applicable laws,” it said.
Promoters of the backstage slope person besides got support to bring their shareholding successful the banks to up to 26 per cent from earlier 15 per cent. Hindujas, who tally IndusInd Bank, person reportedly shown their tendency to bash so. Shares of IndusInd Bank were trading implicit 1% higher astatine Rs 961 apiece connected the BSE today.
Last month, the banking regulator granted support to LIC to rise its involvement successful backstage lender Kotak Mahindra Bank up to 9.99 per cent from 4.96 per cent earlier. In a notification to the exchanges, the lender said, “…Kotak Mahindra Bank Limited has received an intimation from LIC stating that the RBI had granted its support to LIC, for expanding its holding successful the Bank up to 9.99 per cent of the paid up equity stock superior of Bank…”. The support of the cardinal slope volition beryllium valid for 1 year.
Prior support of the RBI is required to summation involvement successful backstage banks beyond 5 per cent, per RBI norms. LIC’s raising of involvement is taxable to compliance with the provisions of the directions fixed by RBI successful 2015 and required regulations by the marketplace regulator SEBI. Among different large banks, LIC holds 8.8 per cent involvement successful Canara Bank, 8.3 per cent successful Punjab National Bank and State Bank of India, 8.2 per cent successful Axis Bank, and 7.6 per cent successful ICICI Bank.
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