New Delhi, Aug 30 (PTI) Private sector lender Kotak Mahindra Bank today said it has got Reserve Bank's approval for selling less than 10 per cent stake in the bank to Canada-based pension fund CPIIB.
"The Reserve Bank of India has informed that the bank that it has granted approval to Canada Pension Plan Investment Board (CPPIB) for acquiring shares in excess of 5 per cent and below 10 per cent of the paid up capital," Kotak Mahindra Bank said in a regulatory filing to stock exchanges.
CPIIB has picked up stake of the bank from Japanese multinational Sumitomo Mitsui Banking Corp (SMBC) through open market operation earlier this year. CPIIB bought 1.81 crore shares from SMBC.
As per the norms, a foreign investor cannot own more than 10 per cent in the private sector bank.
Banks (including foreign banks having branch presence in India) can continue to acquire stake in a bank's equity shares up to 10 per cent of the investee bank's equity capital.
However, in case of exceptional circumstances, such as, restructuring of problem/weak banks or in the interest of consolidation in the banking sector, etc., Reserve Bank may permit them a higher level of shareholding.