The approval granted by the Reserve Bank of India for HDFC Bank Group to acquire up to 9.50 percent stakes in IndusInd Bank, Yes Bank, Axis Bank, ICICI Bank, Suryoday Small Finance Bank, and Bandhan Bank is valid for one year. If HDFC Bank fails to complete the share acquisition within this period, the approval will be automatically canceled. HDFC Bank specified in an exchange filing that the approval is for investments by HDFC Asset Management Company (AMC), HDFC Ergo, and HDFC Life Insurance.
The approval remains effective for one year, and if HDFC Bank does not secure the shareholding within this timeframe, the approval will be revoked. The RBI’s approval is contingent upon adherence to the pertinent provisions of the Banking Regulation Act, 1949, the RBI’s Master Direction and Guidelines on Acquisition and Holding of Shares or Voting Rights in Banking Companies dated January 16, 2023, FEMA, SEBI regulations, and other applicable regulations.
Moreover, HDFC Bank must guarantee that its “aggregate holding” in IndusInd remains below 9.50 percent of the paid-up share capital or voting rights of IndusInd at all times. In the event that the “aggregate holding” drops below 5 percent, obtaining prior approval from the RBI is necessary to increase it to 5 percent or more of the paid-up share capital or voting rights of both IndusInd Bank and Yes Bank.
As per the shareholding structure of IndusInd Bank, the promoters, IndusInd International Holdings Ltd and IndusInd Ltd, jointly possess a 16.45 percent stake in the bank. Mutual funds collectively hold a 15.63 percent stake as of December 2023, and insurance companies, including LIC, have a 7.04 percent stake. Foreign portfolio investors collectively maintain a 38.24 percent stake as of the December quarter.
In the shareholding distribution of Yes Bank, the entire 100 percent stake is held by the public. Within this, LIC possesses a 4.34 percent stake in the bank, and a consortium led by SBI (including Axis Bank, HDFC Bank, ICICI Bank, Kotak Bank) collectively holds a 37.23 percent stake.
Additionally, HDFC AMC holds a 3.43 percent stake in ICICI Bank and a 2.57 percent stake in Axis Bank.
The post The Reserve Bank of India (RBI) Granted Approval to HDFC Bank Group to Acquire Stakes of up to 9.5% in Yes Bank, IndusInd, and Four other Banks appeared first on Insights Success.
