Foreign investment limit in Kotak Mahindra Bank raised to 40pc

Tags: News
The Reserve Bank has allowed raising foreign investment limit under portfolio investment in private sector Kotak Mahindra Bank to 40 per cent.

The Reserve Bank of India's (RBI) approval is on the condition that aggregate foreign investment will not exceed composite sectoral cap of 74 per cent (49 per cent under automatic route and beyond it to 74 per cent under approval route), the central bank said in a release.

Kotak Mahindra Bank has passed a resolution at board meeting and AGM for purchase of equity shares by FIIs/FPIs/QFIs up to 40 per cent (revised from earlier limit of 37 per cent) of their paid-up capital, it said.

Equity shares of the bank can now be purchased through primary market and stock exchanges provided purchase by a single FII or Sebi approved sub-account does not exceed 10 per cent of the paid-up equity capital of bank.

"It may be ensured that the investments made are within the stipulated ceilings," RBI said.

In a separate release, RBI said foreign investors now would be allowed to purchase equity shares in City Union Bank only after its prior approval as such investment has reached trigger limit.

"The aggregate net purchases of equity shares in City Union Bank Limited by Foreign Institutional Investors (FIIs)/ Registered Foreign Portfolios Investors (RFPIs) has reached the trigger limit.

Hence, further purchases of equity shares of this bank would be allowed only after obtaining prior approval of the RBI," it said.

As per data on BSE, FIIs held 32.23 per cent equity shares in City Union Bank as of quarter ended June 2014.

The RBI monitors ceilings on FII/NRI/PIO investments in Indian companies on a daily basis.

To effectively monitor the limit, RBI has fixed cut-off points two percentage points lower than the actual ceiling.

Post new comment

E-mail ID will not be published
CAPTCHA
This question is for testing whether you are a human visitor and to prevent automated spam submissions.

EDITORIAL OF THE DAY

  • Amidst Sino-Indian bonhomie, the Tibet issue cannot be wished away

    Tibet did not figure in the three-day high-level meetings between India and the People’s Republic of China (PRC).

FC NEWSLETTER

Stay informed on our latest news!

INTERVIEWS

GV Nageswara Rao

MD & CEO, IDBI Federal Life

Timothy Moe

Goldman Sachs

Chander Mohan Sethi

CMD, Reckitt Benckiser India

COLUMNIST

Varun Dutt

<b>Riskfactor</b>: Intertemporal choices

Intertemporal choice is the study of the relative value people ...

Parvez Imam

Why we all have blood on our hands

What does the Jammu and Kashmir flood make us think? ...

Dharmendra Khandal

The peculiar possibilities of animal poop

You can tell a lot about an animal by its ...

INTERVIEWS

William D. Green

Chairman & CEO, Accenture