The private sector bank, Kotak Mahindra is seeking FIPB approval to hike the the foreign investment in the entity to 55%  the reason behind is RBI’s move of restrictions for more investments after they hit the permissible threshold.

Foreign investors can acquire up to 49% stake in Indian lenders through automatic route, beyond that they requires the approval of FIPB.

At present pursuant to its merger with ING Vysya Bank the foreign investors including FIIs, FPIs and foreign Banks together hold 48.55% in the bank.

On Tuesday the Kotak Mahindra Bank has allotted 13.92 crore shares to the shareholders of ING Vysya and completed the merger process, after which the foreign shareholding soared to 48.55%.

“Kotak Mahindra Bank’s application for an approval to increase the aggregate ceiling on foreign investment to 55 per cent is currently under the consideration by the FIPB,” Kotak Bank said.