Foreign Investment Promotion Board (FIPB) received an application from Axis Bank for hiking its foreign shareholding limit.
As on June 30, 2013, the foreign shareholding in the bank stood at 48.96 percent. This includes investments through the FDI route in the form of global depository receipts (GDRs) of 8.08 percent and other foreign holdings, including FIIs of 40.88 percent.
Since the overall limit of 49 per cent of paid-up capital has already been breached by these various forms of foreign shareholding, Reserve Bank of India (RBI) prohibited more investments through certain routes in Axis Bank.
These routes include GDRs, American depository receipts (ADRs), foreign direct investment (FDI), non-resident Indian (NRIs), persons of Indian origin (PIOs), FIIs.
Following this, the bank filed an application with the FIPB to increase the foreign shareholding limit. However, it is not known what is the percentage increase it is looking at.
It can be noted tha all the private sector lenders have higher foreign shareholding. Early this year, the RBI had said Yes Bank 13.94 percent also had breached the 49 percent cap.
Leave a Reply
You must be logged in to post a comment.