HDFC Bank Receives RBI Approval To Acquire Up To 9.5% Ownership In ICICI Bank, 5 Others

In a momentous milestone, the HDFC Bank Group stated on Tuesday that it has received from the Reserve Bank of India’s (RBI) approval to purchase an aggregate holding of up to 9.5 percent of the paid-up share capital or voting rights in six banks.

These banks are Axis Bank, Survoday Small Finance Bank, ICICI Bank, Bandhan Bank, YES Bank, and IndusInd Bank.

In a regulatory filing, the Bank stated, “The approvals were granted under applications made by HDFC Bank (as a promoter/sponsor of the Group) to RBI on December 18, 2023”.

It went on to say, “RBI’s approval is valid for one year from the date of RBI’s letter, ie, till February 4, 2025. Further, HDFC Bank shall ensure that the ‘aggregate holding’ in the above-mentioned banks does not exceed 9.50 percent of the paid‐up share capital or voting rights of the respective banks, at all times”.

The bank stated that it did not intend to invest in these banks but because the stake was anticipated to surpass 5 percent under the RBI rules, it applied to increase the investment limits.

“Further, since the RBI Directions apply to HDFC Bank, the Bank had made the application to RBI on behalf of the Group”, the Bank continued.

These banks have also provided updates on the developments in separate filings.

“The RBI, while granting the above-referred approval, has also conveyed that if the applicant fails to acquire major shareholding within one year from the date of the aforesaid RBI letter, the approval shall stand canceled”, the statement reads.

The HDFC Group consists of HDFC Bank, HDFC Mutual Fund, HDFC Life Insurance Company Limited, HDFC ERGO General Insurance Company Limited, and others.