Kotak Mahindra Bank Ltd. said its board has approved a proposal to increase foreign shareholding limit by 2 percentage points to 45 percent.
“The board of directors of the bank has today approved increase in ceiling limit on the total shareholding of foreign institutional investors/foreign portfolio Investors from the current limit of 43 percent to 45 percent with immediate effect,” the bank said in a regulatory filing.
The Reserve Bank of India had earlier asked the lender to pare promoter Uday Kotak's shareholding down gradually to 15 percent by March 31, 2020.
The bank was asked to cut Kotak's holding to 20 percent of the paid-up capital by December 2018 and further to 15 percent by March 31, 2020. Kotak held 29.72 percent stake in the bank as on Dec. 31, 2018.
Uday Kotak, vice chairman and managing director of Kotak Mahindra Bank, earlier held 30.03 percent stake.
To bring his shareholding down, the bank in August 2018 had proposed to issue perpetual non-cumulative preference shares to meet the said deadline, which was rejected by RBI. Kotak Mahindra Bank then moved the Bombay High Court challenging the RBI's decision.
Stock of the bank closed at Rs 1,235.75, down 0.44 percent, on BSE.
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