SBI Capital Markets Ltd, a unit of the State Bank of India, had sought the central bank’s approval to increase its stake in the partnership from around 20 per cent to around 40 per cent, sources said. Photo credit: REUTERS/RUPAK DE CHOWDHURI
The Reserve Bank of India has rejected a proposal by the country’s largest bank to increase its stake in an institutional equity joint venture with a local unit of Investec Plc, people familiar with the matter said.
SBI Capital Markets Ltd, a unit of the State Bank of India, had sought the central bank’s approval to increase its stake in the partnership to about 40 percent from about 20 percent, the people said, asking not to be identified discussing private information. Concerns centered on the duplication of businesses within the broader group of SBI companies, one of the people said.
The regulator has asked SBI to either take full ownership or ensure compliance with the proposed rules for financial entities, the person added. Representatives of the RBI, SBI and Investec did not respond to requests for comment.
Investec India’s businesses include corporate advisory, private credit, institutional equities and research, as well as equity capital markets. Investec partnered with SBI Capital Markets in 2020 to help both companies expand their reach in ECM.
An RBI draft document from October 2024 shows that multiple entities within a banking group cannot carry on the same activities or hold the same category of licenses from a financial sector regulator. It is also stated that overlapping lending activities between a bank and its subsidiaries are not permitted.
However, RBI Governor Sanjay Malhotra said earlier this month that the final guidelines will drop proposed restrictions on business overlaps between banks and their group entities, giving boards more freedom on strategic allocations. Such measures have yet to be released.
SBI plans to submit a fresh proposal once the final guidelines are issued, one of the people said.
More stories like this are available at bloomberg.com
Published on October 30, 2025
#RBI #rejects #SBIs #proposal #increase #stake #Investec #unit