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ICICI to pare stake in ICICI Bank to 40%

NetScribes/Anil Varma

Term-lending institution ICICI Ltd will reduce its stake in banking subsidiary ICICI Bank to 40 per cent from the current 46 per cent during this financial year, its managing director and chief executive officer K V Kamath said on Thursday.

The Reserve Bank of India has asked promoters of private sector banks to keep their holdings in these entities within a maximum of 40 per cent.

Kamath, however, did not elaborate on what route the institution would take to divest its stake in the bank. ICICI had sold 10 percent of its stake in its banking arm during 2000-01 in response to a reiteration by the central bank that the institution has to lower its stake in the bank to 40 percent, bringing it down to the present level.

Asked whether ICICI Bank would consider any acquisitions or mergers to expand business, Kamath said no such move was afoot at present.

"If an opportunity comes, the bank will decide appropriately," he said.

ICICI Bank had taken over the private sector Bank of Madura in FY2001.

The institution is planning to retain its holdings in the South-based Federal Bank and the South Indian Bank as investments, Kamath said. ICICI has a 26 per cent stake in Federal Bank and 25 per cent in South Indian Bank.

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