New Delhi: Private sector lender Kotak Mahindra Bank on Monday in an exchange filing said the Reserve Bank of India (RBI) had granted its approval to Life Insurance Corporation of India (LIC) to increase holding in the bank up to 9.99 per cent.
As of September 30 this year, LIC held a 4.96 per cent stake in Kotak Mahindra Bank. The bank said the approval is valid for a period of one year.
This is subject to compliance with the provisions issued by the Securities and Exchange Board of India (Sebi), provisions of the Foreign Exchange Management Act, 1999 and any other guidelines/regulations and statutes, as applicable, the bank said.
LIC has been increasing its stake in Kotak Mahindra Bank for several quarters.
As of 2.15 pm, the shares of Kotak Mahindra Bank on Monday were up 3.6 per cent at Rs 2,036 on the NSE.
Last week, the RBI accepted a working group’s recommendation to increase promoter stake in private banks till 26 percent and non-promoter stake to 10 per cent.
As of September 30, the LIC holds 4.96 per cent stake in Kotak Mahindra Bank. Promoters Uday Kotak and family holds 26 per cent stake in Kotak Mahindra Bank while Canada Pension Plan Investment Board holds 6.37 per cent.
In 2020, Uday Kotak moved court against the RBI’s direction to reduce promoter stake to 15 per cent. However, the RBI later agreed to allow Kotak to retain stake at 26 per cent.