Overview
- AU Small Finance Bank disclosed Thursday that the Reserve Bank of India, in a May 6 letter, allowed Kotak Mahindra Bank and affiliated funds to take an aggregate stake of up to 9.99%.
- The approval covers Kotak Mahindra Bank, its subsidiaries, and funds or schemes they manage, which count together toward the 9.99% limit.
- RBI’s clearance comes with conditions that require compliance with the Banking Regulation Act, FEMA, SEBI norms, and other laws, so no shares change hands until purchases are executed and disclosed.
- Kotak Flexicap Fund already owns 1.60% of AU SFB as of the March quarter, indicating an existing foothold that could grow within the new cap.
- Early trading reports were mixed after the filing, with News18 noting shares down near Rs 1,022 and Republic World citing a 1.26% gain to about Rs 1,036.90 as the session progressed.