Federal Bank seeks FIPB nod to raise foreign holding limit

South-based private sector lender Federal Bank today said it has applied to the Foreign Investment Promotion Board for hiking the foreign holding limit in the bank to 65 percent.

"The bank has filed an application with FIPB for increasing the foreign shareholding limit to 65 percent," it said in a statement issued here. The move has been necessitated because of the Reserve Bank's August 20 press release prohibiting foreign institutional investors, non resident Indians and persons of Indian origin from purchasing shares in Federal Bank as its foreign holding has crossed 49 percent.

"Foreign shareholding through FII/ NRI/ PIO/ FDI/ ADR/ GDRs in Federal Bank has crossed the overall limit of 49 percent of its paid up capital and that no further purchases of shares of the Bank would be allowed," the bank statement said, quoting the RBI press release.

The bank's exact foreign holding was not immediately known. The bank scrip was trading 1.19 percent up at Rs 288.70 apiece on the BSE, whose 30-share benchmark was up 0.21 percent.

Another private lender Axis Bank, which also faced such an action from RBI, had last week said that it has made a similar request to the FIPB.