Kotak Mahindra Bank Gains After RBI Allows LIC To Increase Stake

Shares of the Uday Kotak-led Kotak Mahindra Bank rose as much as 4.1 per cent to hit an intraday high of Rs 2,043.5 on the BSE after the private lender informed exchanges that the country's central bank - Reserve Bank of India - has given its approval to Life Insurance Corporation of India for acquiring shares in the bank.

The RBI has given approval to LIC to increase its holding in the bank up to 9.99 per cent. Currently, LIC owns 4.96 per cent stake in Kotak Mahindra Bank, data from the BSE showed.

"We wish to inform you that Kotak Mahindra Bank Limited has received an intimation from Life Insurance Corporation of India ("LIC") stating that the Reserve Bank of India had granted its approval to LIC, for increasing its holding in the Bank up to 9.99 per cent of the paid up equity share capital of Bank, subject to compliance with the provisions of the 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, provisions of the applicable regulations issued by the Securities and Exchange Board of India, provisions of the Foreign Exchange Management Act, 1999 and any other guidelines/regulations and statutes, as applicable. The approval is valid for a period of one year," Kotak Mahindra Bank said in a stock exchange filing.

As of 2:32 pm, Kotak Mahindra Bank shares traded 3.45 per cent higher at Rs 2,028, outperforming the Sensex which was up 0.22 per cent.