HDFC Bank Receives RBI Approval for 9.99% Stake in LIC

 

Hyderabad, January 24, 2024:* HDFC Bank Limited announced on Thursday that the Reserve Bank of India (RBI) has granted permission to the bank to acquire a 9.99% stake in Life Insurance Corporation of India (LIC). 

Currently, LIC holds a 5.19% stake in HDFC Bank, as disclosed in stock exchange filings.

In a filing with the stock exchange, HDFC Bank stated that the RBI has advised LIC to acquire additional shares in HDFC Bank within one year.

 Additionally, LIC needs to ensure that its total stake in the bank does not exceed 9.99% at any given time, considering both paid-up share capital and voting rights.

Last year in May, RBI had similarly approved LIC to acquire a 9.99% stake in HDFC Bank post the merger. Under RBI regulations, any entity intending to purchase shares in a bank with a substantial shareholding must seek prior approval. 

The increase in shareholding beyond 5% requires regulatory clearance, as requested by LIC due to its stake crossing the 5% threshold after the merger.