ICICI Bank to seek FIPB approval for investment holding subsidiary
Mumbai: The ICICI Bank has said that it would endeavour to obtain Government approval for foreign investments in its investment holding subsidiary. It has, however, cautioned that there is no assurance that it would be successful in getting the required approval.

It points out that the Foreign Investment Promotion Board (FIPB) had earlier rejected its proposal for seeking foreign investment in that company.

The bank said it had received definitive offers from foreign investors for equity participation in the holding company, which would indirectly increase the foreign equity in the insurance venture beyond the prescribed limit of 26 per cent.

The bank has said that its inability to raise capital in a subsidiary, in which it has transferred its equity investments in insurance and asset management businesses, could adversely impact the growth of the insurance business.
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State Bank of India mulls 2-stage equity offer
New Delhi: The Government of India, majority owner of the State Bank of India (SBI), is mulling a change in strategy for sale of its shares in the equity markets. It may go in for a two-stage sale that would see it initially offer a combination of rights issue and preference shares in the first stage and then diluting its stake through a sale of shares in the domestic and international markets.

The rights/preference share issue would actually result in the stake holding of the government rising in the short term, before its eventual dilution through a sale in the open markets.

The move is being considered post-ICICI Bank's "successful" follow-on public issue in the markets last week. What would have set the government thinking would have been the extremely lukewarm response that the offer received from the retail segment.

The government currently holds a 59.73% stake in SBI, which will be formally transferred to it on 29 June, by the Reserve Bank of India.

An amendment to the Act that governs SBI is likely to be cleared by Parliament during the monsoon session, allowing for a reduction in the government's stake to 51%. The amendment will also clear the way for a sale of preference shares.
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