LIC to acquire up to 9.99% stake in HDFC Bank

In a significant development, the Reserve Bank of India (RBI) has given the green light for the Life Insurance Corporation of India (LIC) to acquire a substantial stake of up to 9.99% in HDFC Bank, the country's largest private lender. This approval comes as part of LIC's strategic move to increase its presence in the banking sector.

HDFC Bank disclosed the regulatory nod in a notification to stock exchanges on January 25, revealing that LIC has been advised by the RBI to complete the acquisition of the specified major shareholding within a one-year timeframe, concluding by January 24, 2025.

The RBI has imposed a crucial condition for LIC to ensure that its aggregate holding in HDFC Bank does not exceed 9.99% of the bank's paid-up share capital or voting rights at any given time. This restriction aims to maintain a balance and prevent undue concentration of ownership.

Market analysts are closely monitoring this development, considering the potential impact on both LIC and HDFC Bank. As LIC navigates this acquisition, investors are keenly observing the dynamics in the banking sector and the strategic alliances shaping up within the industry.

It is noteworthy that this news is still unfolding, and additional details may emerge as the situation develops. Stakeholders and market participants are advised to stay tuned for further updates on this evolving story.