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HDFC Bank Receives RBI Approval for Stake Acquisition in Six Banks

HDFC Bank and its affiliated companies have obtained approval from the Reserve Bank of India (RBI) to acquire stakes in six prominent banks. This approval, received on January 5, 2024, grants HDFC Bank and its group entities the authority to acquire an aggregate stake of up to 9.5% in ICICI Bank, Axis Bank, IndusInd Bank, YES Bank, Bandhan Bank, and Suryoday Small Finance Bank (SFB). The approval, valid until February 4, 2025, follows applications submitted by the bank as a promoter or sponsor of the group on December 18, 2023.

RBI Approval Parameters

  • The approval encompasses HDFC Bank and its group entities, including HDFC Mutual Fund, HDFC Life Insurance, and HDFC ERGO General Insurance.
  • The purpose of the approval is to allow acquisitions within the normal course of business for these respective group entities.
  • HDFC Bank is required to ensure that the aggregate holding in the mentioned banks does not surpass 9.5% of the paid-up share capital or voting rights of the respective banks at any given time.

Investment Details

  • HDFC Mutual Fund holds 2.76% voting rights in ICICI Bank, 2.49% in Axis Bank, and 2.23% in IndusInd Bank as of December 2023.
  • HDFC Life Insurance owns a 2.92% stake in Suryoday SFB.
  • HDFC Pension Management possesses a 1.88% stake in IndusInd Bank.
  • HDFC Bank itself holds a 3% stake in YES Bank as of December 31.

Compliance Assurance

  • HDFC Bank pledges to adhere to the prescribed limits and regulations set forth by the RBI regarding stake acquisition in these banks.

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