RBI permits HDFC AMC to acquire a stake in Karur Vysya Bank and DCB

21 Sep 2023 , 12:02 PM

The Reserve Bank of India (RBI) has approved the purchase of up to 9.5% of DCB Bank and Karur Vysya Bank each by HDFC Asset Management Company (AMC).

Both the lender and RBI stated in an exchange filing that the approval is effective for a year from the approval date. Additionally, the central bank informed HDFC AMC that its ownership stake in both private banks should not be greater than 9.5%.

RBI had earlier in June approved Tata AMC’s purchase of a 7.5% stake in DCB Bank.

Karur Vysya Bank increased by more than 10% so far in September, while DCB Bank increased by more than 6%. Compared to Karur Vysya Bank, which has increased almost 18% so far this year, DCB Bank has lost 2%.

Karur Vysya Bank (KVB) reported a 56.7% increase in net profit, from Rs 229 crore in Q2 2022 to Rs 359 crore in Q2 2023. In Q1 FY24, deposits increased by 14% to Rs 80,715 crore from Rs 70,961 crore during the same period the previous year. Contrarily, from Rs 2,611 crore in April through June of FY23, borrowings fell by 41% to Rs 1,555 crore in Q1 FY24.

According to DCB Bank’s Q1FY24 figures, net profit increased by 31% to Rs 127 crore from Rs 97 crore during the same period the previous year. Comparing the June quarter to the same quarter previous year, total income jumped by 24% to Rs 578 crore from Rs 466 crore.

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