HDFC Bank gets 1 year RBI approval for up to 9.5 pc stake in IndusInd Bank
New Delhi, Dec 16
HDFC Bank has received approval from the Reserve Bank of India (RBI) to allow its group entities to collectively hold up to a 9.50 per cent stake in IndusInd Bank.
The approval was granted through a letter dated December 15 and will be valid for one year, until December 14, 2026.
The RBI has clearly stated that the total holding of HDFC Bank and its group entities must not exceed 9.50 per cent of IndusInd Bank’s paid-up share capital or voting rights at any point during this period.
This approval applies to the combined, or “aggregate,†holding of HDFC Bank and the entities where it acts as a promoter or sponsor.
“Further the Bank needs to ensure that the ‘aggregate holding’ in IndusInd does not exceed 9.50 per cent of the paid-up share capital or voting rights of IndusInd, at all times,†the private lender said in its regulatory filing.
These include HDFC Mutual Fund, HDFC Life Insurance Company, HDFC ERGO General Insurance Company, HDFC Pension Fund Management, and HDFC Securities.
Under the Reserve Bank of India’s Commercial Banks (Acquisition and Holding of Shares or Voting Rights) Directions, 2025, aggregate holding includes shares held by the bank itself, companies under the same management or control, mutual funds, trustees, and other promoter group entities.
HDFC Bank clarified that it does not plan to invest directly in IndusInd Bank. However, as the combined investments of its group companies were likely to cross the earlier limit of 5 per cent, the bank sought approval from the RBI to raise the permissible investment cap.
The application for this approval was submitted on October 24, 2025, on behalf of the group entities, as the RBI regulations apply to the bank.
HDFC Bank also said that the investments made by its group companies are part of their regular business activities.
— IANS
Reader Comments
RBI is keeping a close watch, as they should. The 9.5% cap and one-year validity period are sensible safeguards. Prevents any single group from having too much control over another bank. Our regulators are doing their job.
Interesting. So HDFC Mutual Fund, HDFC Life etc. were buying IndusInd shares as part of their regular business, and collectively they were going to cross the 5% limit. Makes sense to seek approval proactively. Transparency is key.
As a retail investor, I find this a bit concerning. Such large cross-holdings between major banks can reduce market competition. Hope SEBI is also monitoring this for any impact on minority shareholders.
Bullish for IndusInd Bank stock! A vote of confidence from the country's largest private bank. Their group entities are long-term investors. This could mean better governance and stability for IndusInd. 🚀
The detailed regulations from RBI (2025 directions) show how mature our financial system is becoming. Everything is by the book. This is how trust is built in the banking sector. Good reporting.
We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.