RBI Approves HDFC Bank Group to Buy ͏Up to 9.5% ͏Stake in IndusInd Bank

Mumbai, December 22 – The Reserve Bank of India (RBI) has given regulatory nod to the HDFC Bank Group for acquiring a stake of 9.5 per cent in IndusInd Bank, enabling it to breach the 5 per cent cap without seeking a special permission as a bank shareholder. The sanction, which was communicated through a stock exchange filing, is valid for one year from 15 December 2025 and is issued when IndusInd Bank is seeking to stabilise operations after governance and financial shocks.

RBI Clears 9.͏5% Aggr͏eg͏a͏te Holding F͏͏͏or HD͏FC G͏roup Entities͏, Expand͏ing Scope Beyond 5% Cap

However, there are certain restrictions, including that the HDFC bank group entity  a combination of HDFC Mutual Fund, HDFC Life Insurance, HDFC Pension Fund, HDFC ERGO and HDFC Securities shall not collectively exceed 9.5% of IndusInd Bank paid-up share capital or voting rights. The approval shall be valid for the group entities and not be applicable to individual acquisitions.

HDFC Bank has clarified that it is not planning to invest directly in IndusInd Bank. The aggregate exposure of the group, however, would be observed under the approved ceiling. As at end-September, the HDFC group held about 4.23% in IndusInd Bank, which suggests there is scope for further acquisition up to the permissible limit.

Acquisition ͏Wind͏ow of 1 Year Set by RBI; Appr͏oval to Su͏bj͏ect to Time-bound Execu͏ti͏on

The acquisition of 9.5% must be comp͏letedwi͏thin a year, or the approval may be revoked by RBI. This is to ensure that it is exercised within a particular time framean͏d not le͏fto͏pen-ended.

Approvals were granted under the Commercial Banks (Acquisition and Holding of Shares or Voting Rights) Directions 2025, which require the banks to obtain the regulator’s approval if they exceed 5% shareholding in another bank. The go-ahead provides the regulator with predictability on crossholdings in the banking sector.

IndusInd Bank Moves into Recovery Phase After $230 Million Governance & Accounting Impact

The nod by the Regulator is being actively appreciated by IndusInd Bank, which just posted the biggest loss ever in the year ending March 2025. The reason for the loss was the result of the bank’s $230 million accounting charge, which resulted in the resignation of the CEO and the Deputy CEO of the entity.

After the incident, the bank faced criticism regarding the oversight by its board and the delayed reporting on risks in its derivatives portfolio. In this regard, the IndusInd Bank has made a prospectus filing for a fund raise to the tune of a maximum of Rs 3,473 crores. They have also proposed that their promoters be allowed to nominate two representatives on the existing boards as a measure to improve their governance structure.

IndusInd Bank and HDFC Bank Share Performance Shows Divergences in 2025

IndusInd Bank stock is down so far this year. On the day of RBI nod announcement, the stock was plummeting around 12.6% year-to-dat͏e. In contrast, HDFC Bank stock has posted a sequential increase of 11.7% during the period, outperforming market benchmarks.

This divergence reflects two different operating trajectories, with IndusInd Bank focused on rebuilding capital strength and governance framework and HDFC Bank remaininglargely stable on its performance parameters.

HDFC B͏a͏͏nk Sh͏͏are Price Moves Marginally͏ Higher ͏on 22 December Trading Session

On 22 December 202͏5,͏͏ ͏H͏DFC Bank Ltd (͏NS͏E: HDFCBANK͏) closed at ₹987.20, up ₹1.70 ͏or 0.17% ͏for the͏͏ ͏day.͏ The stock traded͏͏ within͏ a ra͏͏nge of ₹98͏͏3.9͏0 to ₹992͏.͏90, after ͏opening at ₹988.00.͏ At͏ 14:͏1͏0 ͏IST,͏ the price͏ stood at ₹98͏5.͏80. The bank’s͏ market ͏capitalisation ͏was ₹7.57 lak͏͏h crore, with a P/͏E͏͏ ratio͏ of 20͏.99.͏ The 5͏2-͏week high stood ͏at ͏₹1,0͏20.50, while the 52-week low ͏w͏͏as ͏₹͏͏812.15.͏

Source: https://www.nseindia.com/get-quote/equity/HDFCBANK/HDFC-Bank-Limited

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