Reserve Bank of India Grants Approval to LIC for 9.99% Holding in HDFC Bank

• 27 Jan 2024

On 25^th January, 2024, the Reserve Bank of India (RBI) gave its nod to Life Insurance Corporation of India (LIC) to acquire a 9.99% aggregate holding in HDFC Bank, as confirmed by an exchange filing on Thursday.

Key Points

• RBI Approval: The RBI, in its letter dated January 25, 2024, addressed to LIC, approved the acquisition of up to 9.99% of the paid-up share capital or voting rights of HDFC Bank.
• Regulatory Compliance: The approval is granted subject to adherence to conditions outlined in Regulation 30 of the SEBI Listing Regulations and other relevant regulations, including compliance with the Banking Regulation Act, 1949, RBI’s Master Direction and Guidelines on Acquisition and Holding of Shares or Voting Rights in Banking Companies, provisions of the Foreign Exchange Management Act, 1999, and SEBI's regulations.
• Previous Application: The central bank's approval follows LIC's earlier application seeking permission to acquire voting rights in HDFC Bank.
• Stake Acquisition Deadline: As per RBI regulations, LIC is required to acquire the 9.99% stake within the stipulated timeframe, ensuring that its holding remains below the specified threshold throughout the year.