RBI Approves IFC's 9.7% Stake Acquisition In Federal Bank
The Reserve Bank of India (RBI) has granted its approval for the International Finance Corporation (IFC) to acquire a 9.7 per cent stake in Federal Bank.
In July, the private bank had successfully raised Rs 959 crore from IFC through a preferential share issuance, as IFC is a member of the World Bank group.
An exchange filing by Federal Bank on Friday conveyed, "On 28 September 2023, the RBI informed Federal Bank that it has given its consent to IFC for acquiring an aggregate holding of up to 9.70 per cent of the paid-up share capital or voting rights of the Bank, subject to specified conditions."
The filing further added, "This approval has been granted based on IFC's application to the RBI."
It's important to note that following the RBI's approval, the stake acquisition is contingent upon compliance with additional regulatory requirements.
RBI's approval is subject to adherence to the relevant provisions of the Banking Regulation Act, 1949, RBI's Master Direction and Guidelines concerning the acquisition and holding of shares or Voting Rights in Banking Companies, provisions outlined in the Foreign Exchange Management Act, regulations issued by the Securities and Exchange Board of India, as well as any other applicable guidelines, regulations, and statutes.
Federal Bank had previously announced its plan to open 100 additional branches in the fiscal year 2023-24, aligning with its increased emphasis on serving small businesses. This move comes after the bank had successfully inaugurated 75 branches in the previous fiscal year, 2022-23.
