LIC gets green light from RBI to raise HDFC Bank stake to nearly 10%

The Reserve Bank of India (RBI) has approved Life Insurance Corporation of India's (LIC) proposal to increase its stake up to 9.99% in HDFC Bank.In the August 19 regulatory filing of HDFC Bank, the bank notified that the RBI has approved LIC's application to acquire up to 9.99% of the bank's paid-up share capital or voting rights.According to the stock exchange filing, the RBI "has accorded its approval to Life Insurance Corporation of India ("LIC")" for acquiring the additional stake in HDFC Bank.The approval would therefore allow LIC, which currently holds 4.11% of the banks’ total share capital, to increase its ownership in the private sector lender. However, any increase in LIC’s ownership of the Bank’s stakes would be subjected to the applicable regulatory and statutory requirements as per Sebi guidelines. The development comes after LIC approached the RBI seeking permission to raise its holding in HDFC Bank. For HDFC Bank, this move means that one of its biggest institutional investors has received regulatory permission to potentially increase its ownership.On the other hand, for LIC, a higher stake in the bank would significantly expand its investment scope in the financial service sector. As a result, any eventual increase in LIC’s stake could therefore have implications for both the insurer’s investment portfolio and the bank’s shareholder mix. That said, it is important to note that the RBI approval by itself does not necessarily indicate how much additional stake LIC intends to acquire or when it may do so.In other words, LIC can decide whether to increase its holding and, if it does, the purchases will have to be made within the permitted limit complying with the applicable regulatory conditions.(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)- EndsPublished By: Radhika VermaPublished On: Aug 21, 2026 15:00 IST