Life Insurance Corporation of India has received approval from the RBI to raise its stake in Kotak Mahindra Bank to up to 9.99%, the bank informed the stock exchanges on Monday. LIC held 4.96% stake in the private lender as on 30 September 2021.
“We wish to inform you that Kotak Mahindra Bank Limited (“Bank”) has received an intimation from Life Insurance Corporation of India (“LIC”) stating that the Reserve Bank of India had granted its approval to UC, for increasing its holding in the Bank up to 9.99% of the paid up equity share capital of Bank, subject to compliance with the provisions of the Master Direction on “Prior approval for acquisition of shares or voting rights in private sector banks dated November 19, 2015 and Master Direction on ‘Ownership in private sector banks’ dated May 12, 2016, provisions of the applicable regulations issued by the Securities and Exchange Board of India, provisions of the Foreign Exchange Management Act, 1999 and any other guidelines/regulations and statutes, as applicable. The approval is valid for a period of one year,” said the notice.
The RBI norms mandate that every person or an entity who intends to make an acquisition in private banks of more than 5% stake, has to take prior approval from the central bank.