The Cabinet Committee on Economic Affairs has approved the proposal of Federal Bank for increase in foreign investment to 74 percent subject to the aggregate foreign institutional investors (FIIs) shareholding not exceeding 49 percent of the paid up equity share capital of the bank, an official release said.
The approval would result in foreign investment of approximately Rs 1,400 crore in the country, it said.
Federal Bank had approached the Foreign Investment Promotion Board (FIPB), as Reserve Bank in August, 2013, prohibited foreign institutional investors, non-resident Indians and persons of Indian origin from purchasing shares in Federal Bank as its foreign holding had crossed 49 percent.
Subsequently, FIPB in October last year cleared the proposal to raise the foreign investment holding.
As on September 2013, holding of FIIs in the bank was 44.11 percent, of DII (domestic institutional investors) 20.60 percent and of others 35.29 percent.
Shares of the bank closed at Rs 82.65, up 4.03 percent on BSE over its previous close.


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