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HDFC Bank on Tuesday said RBI has given approval to the group to acquire up to 9.5 per cent stake each in six lenders, including ICICI Bank and Axis Bank.
The Reserve Bank of India (RBI) gave its approval on February 5, 2024.
The entities under HDFC Bank Group are HDFC Mutual Fund, HDFC Life Insurance Company, HDFC ERGO General Insurance Company and others.
“The approvals have been granted pursuant to applications made by HDFC Bank (as promoter/sponsor of the Group) to the RBI on December 18, 2023,” HDFC Bank said in a regulatory filing.
The six lenders in which HDFC Bank will take stake are: Axis Bank, Suryoday Small Finance Bank, ICICI Bank, Bandhan Bank, Yes Bank and IndusInd Bank. The RBI approval is valid for a period of one year until February 4, 2025, he said.
As per RBI directions, HDFC Bank will have to ensure that the aggregate holding in the six banks does not exceed 9.50 per cent of the paid-up share capital or voting rights of the respective banks, at all times.
“In view of the same, while HDFC Bank has no intention of investing in these banks as the ‘aggregate holding’ of HDFC Bank Group would likely exceed the prescribed limit of 5 per cent, an application seeking approval of the RBI to increase in investment limits,” he said.
Further, since the RBI directions are applicable on HDFC Bank, the bank submitted the application to the RBI on behalf of the group, it said.
The RBI has also directed the group to acquire majority stake in all banks within a year from the date of approval, failing which it would be terminated.
Yes Bank
As per Yes Bank’s shareholding pattern, 100 per cent stake is in the hands of the public. Of this, LIC holds a 4.34 per cent stake in the lender, while the SBI-led consortium (which includes Axis Bank, HDFC Bank, ICICI Bank, Kotak Bank) holds a 37.23 per cent stake.
RBI approval is subject to compliance with the relevant provisions of the Banking Regulation Act, 1949, RBI Directorate General 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. .
(With contributions from the agency)