The ICICI Lombard share price gained more than 3 percent on Monday after the Reserve Bank of India gave nod to the ICICI Bank request for extending the deadline for diluting its stake in the general insurer to less than 30 percent until September 9, 2024.
As of December 2022, ICICI Bank holds a 48.02 percent stake in ICICI Lombard General Insurance. Section 19(2) of the Banking Regulation Act limits a bank's shareholding to 30 percent of a company's capital, unless the company is a subsidiary of the bank.
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In September 2020, ICICI Bank was granted an exemption for a period of three years with respect to its shareholding above 30 percent in ICICI Lombard General Insurance Company and ICICI Prudential Life Insurance Company.
The exemption during its operation may permit both ICICI Lombard General Insurance Company and/or ICICI Prudential Life Insurance Company to consider strategic options such as mergers and acquisitions or capital raise which have the potential of reducing the bank's shareholding, the company had said.
In September 2021, ICICI Lombard ceased to be a subsidiary of ICICI Bank after the bank reduced its stake from 52 percent to 48 percent.
At 10:53am, ICICI Lombard's share price was trading up by 1.50 percent at Rs 1,091.25 and ICICI Bank was trading 1.23 percent higher at Rs 853. The Nifty Bank index was trading flat at 40,486.00 points, while the Nifty Financial Services was up 0.48 percent to 18,014.60 points.
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