The promoter of India's CSB Bank has received approval from the Reserve Bank of India to retain a 26% stake in the lender, instead of 15% as advised by the central bank earlier, CSB said on Thursday.
FIH Mauritius Investments Ltd (FIHM), which currently holds a 49.72% stake in the Thrissur, Kerala-based bank according to BSE data, shall bring down its shareholding within 15 years from the date of completion of investments.
The RBI earlier required promoters of banks to reduce their shareholding to 15% to ensure these institutions are widely held.
However, following a legal battle with Uday Kotak, the promoter of Kotak Mahindra Bank, the regulator permitted promoters to retain up to 26% in banks.
Among others, IndusInd Bank's promoters have benefited from the rule change, after they were given regulatory approval earlier in the year to raise their stake to 26% in the bank.
(Reporting by Meenakshi Maidas in Bengaluru; Editing by Tasim Zahid)