RBI allowed Karur Vysya Bank to increase FII investment limit to 40 % from 35%
Private sector lender Karur Vyasa Bank (KVB) has been allowed by the Reserve Bank of India’s (RBI) to increase investment limit to 40% from 35% for foreign institutional investors (FIIs).
However RBI saidt, equity shares held by single FII should not exceed 10% of the paid-up equity capital of the bank and the investments made should be within the stipulated ceilings.
RBI’s approval to Karur Vysya Bank for raising FIIs investment limit to 40% is subject to the condition that aggregate foreign investment in the bank should not exceed the composite sectoral cap of 49% (49% under automatic route and beyond 49% to 74% under government route).
The present policy of Department of Banking Operations and Development (DBOD) requires RBI’s acknowledgement for acquisition or transfer of shares of 5% and more of a private sector bank by FIIs.
As on September 2013, FII holding in Karur Vysya Bank stood at 24.89%, Domestic Institutional Investor holdings at 13.30%, public holding at 58.75% and Promoter holdings stood at 3.06%.
Karur Vysya Bank closed Friday 1.4% higher at Rs349 on the BSE while the 30-share Sensex ended marginally down at 20,851.
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