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RBI may raise promoter holding cap in private banks

RBI may raise promoter holding cap in private banks

The Reserve Bank of India (RBI) is looking to raise the 15% ceiling on promoter shareholding in private sector lenders as part of new rules that are being drawn up, said people with knowledge of the matter. Voting rights will however be capped at 15-20%, they said.

The move to balance ownership and control comes as some private sector banks have sought a relaxation in licensing norms, citing the regulator’s recent decision on Kotak Mahindra Bank. The RBI didn’t respond to queries.

“The central bank has been reworking the shareholding norms to ensure parity among all players,” said one of the persons. “The new rules were in the works but delayed due to the Covid-induced lockdown, and might be issued in a few weeks."

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