India’s banking sector has received important news. SBI Mutual Fund has received RBI approval to buy up to 9.99% equity stake in Bandhan Bank and RBL Bank. This step shows strong interest from a large institutional investor.
The Reserve Bank of India has allowed SBI Mutual Fund to increase its total holding in both banks to 9.99%. The holding must not cross this limit at any time. The rule applies to both paid up share capital and voting rights.
The RBI has also fixed a timeline. SBI Mutual Fund must complete the purchase within one year from the date of approval. If the fund fails to do so, the approval will stand cancelled.
There is another important condition. If the stake of SBI Mutual Fund falls below 5% in either Bandhan Bank or RBL Bank, the fund must take fresh RBI approval before raising it again to 5% or more. This rule keeps control over ownership levels in private banks.
The approval follows the Banking Regulation Act, 1949. It also requires compliance with RBI rules issued in 2025 for share acquisition. The fund must also follow FEMA, 1999 and SEBI regulations.
Bandhan Bank informed stock exchanges about the RBI approval. The bank clearly stated that aggregate holding must always remain within the 9.99% cap. The development comes at a time when Bandhan Bank is working to improve asset quality and strengthen its core lending business.
RBL Bank also confirmed the approval. It said SBI Mutual Fund can buy up to 9.99% stake within one year. RBL Bank remains in focus as Emirates NBD plans to acquire a 60% stake after receiving approval from the Competition Commission of India. The entry of SBI Mutual Fund adds more institutional support to the bank.
SBI Mutual Fund is managed by SBI Funds Management. It is a joint venture between State Bank of India and France based Amundi Asset Management. SBI holds 61.86% stake in the company. Amundi India Holding owns 36.33%. Others hold 1.81%.
The fund managed Rs 26.20 lakh crore in assets in FY25. It recorded a 23% growth rate in assets over the last five years. It reported a Profit After Tax of Rs 2,531 crore in FY26. It also added 62 lakh new investors during the year.
The RBI approval gives SBI Mutual Fund a stronger presence in the banking sector. It also shows that the regulator wants strict control over ownership limits. The coming months will show how this equity stake changes the position of Bandhan Bank and RBL Bank.
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