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  1. SBI Mutual Fund gets RBI nod to acquire up to 9.99% stake in Karur Vysya Bank

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SBI Mutual Fund gets RBI nod to acquire up to 9.99% stake in Karur Vysya Bank

Upstox

2 min read | Updated on August 24, 2024, 10:02 IST

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SUMMARY

SBI MF must ensure that the aggregate holding in the bank does not exceed 9.99% of the paid-up share capital, a regulatory filing said. If the aggregate holding falls below 5%, prior approval of RBI will be required to increase it to 5%, it added.

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The approval has been granted with reference to the application made by SBI MF to RBI

SBI Mutual Fund, an arm of the country's largest state-run lender State Bank of India, has received nod from the Reserve Bank of India (RBI) to acquire up to 9.99% stake in Karur Vysya Bank, a regulatory filing stated on Friday, August 23.

"The RBI vide its letter dated August 23, 2024, has accorded its approval to SBI Mutual Fund (SBI MF) for acquiring aggregate holding of up to 9.99% of the paid-up share capital or voting rights," Karur Vysya Bank informed the exchanges.

The approval has been granted with reference to the application made by SBI MF to RBI, it noted.

"If SBI MF fails to acquire major shareholding within a period of one year from the date of RBI’s letter, this approval shall stand cancelled," the filing added.

However, SBI MF must ensure that the aggregate holding in the bank doesn’t not exceed 9.99% of the paid-up share capital or voting rights at all times, it said.

Further if the aggregate holding falls below 5%, prior approval of RBI will be required to increase it to 5% or more of the paid-up share capital, the filing further stated.

Notably, Karur Vysya Bank is a listed private lender, with a market capitalisation of ₹17,879 crore. It is headquartered in Tamil Nadu's Karur, and primarily operates in retail, corporate and treasury banking segments.

The announcement related to the RBI's nod for SBI MF to acquire stake in the bank was made post the market hours on Friday. The lender's shares had settled in the red, last trading 0.42% lower at ₹222.45. Year-to-date, the stock has gained by around 30%.

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