LIC Gets RBI Approval to Acquire Up to 9.99% Stake in ICICI Bank
Regulatory clearance allows Life Insurance Corporation to increase its holding in one of India's largest private-sector lenders
NEW DELHI, Sept 7: The Reserve Bank of India has approved Life Insurance Corporation of India (LIC) to acquire up to a 9.99 per cent stake in ICICI Bank, putting the state owned insurer’s proposed investment in the private-sector lender in focus.
The approval from the central bank is expected to draw investor attention to ICICI Bank shares as markets assess the potential impact of LIC’s increased presence in the lender.
LIC, one of India’s largest institutional investors, already has significant investments across the country’s financial sector. The latest regulatory clearance provides the insurer with permission to raise its holding in ICICI Bank within the approved limit.
The move comes at a time when Indian financial markets are navigating heightened global uncertainty, including fluctuations in crude oil prices, currency movements and changing expectations around US monetary policy.
ICICI Bank remains one of India’s major private-sector lenders, with a large presence across retail banking, corporate lending and financial services.
For LIC, increasing exposure to the banking sector could strengthen its participation in India’s financial-services growth story. The insurer’s investment decisions are closely watched because of its substantial asset base and importance to domestic capital markets.
Market participants are expected to monitor the timing and scale of any purchases following the RBI’s approval, as well as the potential implications for the lender’s shareholding structure.
The development also highlights the continued importance of large institutional investors in India’s equity markets at a time when foreign investors have turned cautious. Foreign portfolio investors withdrew Rs 7,443 crore from Indian equities during the first week of September.
