SBI MF Gets RBI’s Nod to Buy 10% Stake in Equitas Small Finance Bank

The Reserve Bank of India gave its approval to SBI Funds Management Ltd to acquire up to 9.99% stake in Equitas Small Finance Bank through the schemes of SBI Mutual Fund, the bank said in an exchange filing. Franklin Templeton Mutual Fund and DSP Mutual Fund have also received RBI’s approval to buy 9.99% stake each in the bank.

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More About This Development:

Shares of Equitas Small Finance Bank witnessed a surge in buying activity, with the stock price rising as much as 7% to hit a fresh record high, in an otherwise weak broader market. The share price of the private lender got a boost after the Reserve Bank India (RBI) gave nod to SBI Funds Management Limited (SBIFML) to acquire shares in the bank.

Compliances Regarding This:

The aforesaid approval by RBI is subject to compliance with the relevant provisions of Banking Regulation Act,1949, Master Direction on Prior Approval for Acquisition of shares or voting rights in Private Sector Banks dated November 19, 2015 and Master Direction on Ownership in Private sector Banks dated May 12, 2016, issued by RBI, provisions of the regulations issued by Securities and Exchange Board of India, provisions of the Foreign Exchange Management Act, 1999 and any other guidelines, regulations and statutes as applicable and is valid for a period of one year i.e. up to January 02, 2024.

The Ownership Of The Bank:

As of September 30, 2022, promoter group entities own 74.5% stake in the bank, while mutual funds and foreign institutions hold 13.17% and 4.26% shares, respectively. Among others, retail investors own 6.73% shareholding. The exchange data showed that SBI Large & Midcap Fund held 3.09% stake in the bank.