ICICI Bank Ltd. announced that it has received a nod from the Insurance Regulatory and Development Authority of India for increasing its stake in ICICI Lombard General Insurance Co. by 4%, which would make it a subsidiary.
The bank currently owns 48.02% stake in ICICI Lombard, as on March 31, 2023, the company said in an exchange filing.
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This approval is in relation to its earlier intimation filed with the exchanges on May 28. ICICI Bank's Board of Directors had approved an increase in the shareholding in ICICI Lombard General Insurance, "in multiple tranches up to 4% additional shareholding as permissible under applicable law ... and make the company (ICICI Lombard), a subsidiary of the bank subject to receipt of necessary regulatory approval(s)".
The additional stake acquisition of 4% is through purchase of shares from the market.
After the initial announcement, the company had on Aug. 4 also received approval from the Reserve Bank of India for increasing stake in the general insurer.
According to the filing, the intimation from the insurance regulator stated that the IRDAI approval is subject to the condition that ICICI Bank will continue to act as promoter of the company, comply with the IRDAI Regulations and such other conditions as mentioned and "is valid for a period of one year from the date of the letter".
ICICI Bank, therefore, has time up to Aug. 31, 2024, to increase its shareholding in the insurance company in one or more tranches.
Shares of ICICI Bank closed 1.13% higher at Rs 969.05 per share while ICICI Lombard General Insurance Co. closed 2.08% up at Rs 1,341.30 apiece on Sept. 1, as compared with a 0.86% rise in the benchmark Sensex.
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