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MumbaiReserve Bank of India allowed Life Insurance Corporation of India to double its stake in private sector lender IndusInd Bank Ltd, the company said in a filing to the exchanges.
The bank said in a filing on Friday that the country’s largest insurer may increase its stake in the bank set up by the billionaire Hinduja brothers to 9.99% from the current 4.95%. The approval to increase the holding is valid for one year, as per the filing.
This is the second time in two weeks that the regulator has allowed LIC to increase its stake in the local lender. Last month, it said the insurer may increase its stake in Kotak Mahindra Bank to around 10%.
The announcements come after the central bank recently relaxed ownership rules in private banks. The founders are now allowed to increase their stake to 26% from the current 15%. Detailed operational guidelines are in the works.
Uday Kotak, the world’s richest banker who founded Kotak Mahindra Bank Ltd, already owns 26% in the lender after a lengthy court case with the regulator. The billionaire Hinduja brothers are keen to increase their founding stake in IndusInd Bank, now that the final rules have been announced. , bloomberg,
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