LIC gets RBI nod to raise ICICI Bank stake to 9.99%; ₹59.39 trillion AUM gives insurer room to deepen exposure

The Reserve Bank of India (RBI) has approved Life Insurance Corporation of India (LIC) to acquire an aggregate holding of up to 9.99% in ICICI Bank, potentially more than doubling the state-owned insurer’s existing stake in the private lender.

ICICI Bank disclosed the approval in a stock exchange filing, saying it received a copy of the RBI’s letter, dated September 4, 2026, at 9:09 pm on the same day.

The approval allows LIC to acquire up to 9.99% of the bank’s paid-up share capital or voting rights within one year. If the acquisition is not completed within that period, the RBI approval will stand cancelled. The clearance is also subject to applicable statutory and regulatory requirements.

LIC already holds 4.35% in ICICI Bank

LIC held 31.18 crore ICICI Bank shares, equivalent to 4.35% of the bank’s net paid-up capital, at the end of June 2026. The RBI approval therefore provides the insurer with headroom to increase its holding by another 5.64 percentage points, taking its total stake to 9.99% if it utilises the entire approval.

Importantly, the regulatory clearance does not mean LIC has already purchased the additional shares. It gives the insurer permission to make the acquisition within the stipulated one-year window.

The development also underlines LIC’s growing presence in India’s banking sector. As of June 2026, insurance companies collectively held 8.24% of ICICI Bank, with LIC accounting for more than half of that holding. SBI Life Insurance held another 1.43%. Mutual funds, meanwhile, collectively owned 29.60% of the private lender.

LIC’s ₹59.39 trillion AUM gives it significant investment firepower

The ICICI Bank approval comes as LIC continues to deploy its enormous investment portfolio across Indian equities. Its assets under management stood at ₹59.39 trillion at the end of Q1 FY27, while investment income rose 6% year-on-year to ₹1.09 trillion during the quarter.

LIC’s latest regulatory disclosures for June 2026 also list ICICI Bank among its major equity investments, underscoring the lender’s importance within the insurer’s portfolio.

The RBI’s decision follows a similar regulatory clearance that allows LIC to raise its holding in other large private-sector banks. For ICICI Bank, however, the approval potentially gives the country’s largest institutional investor substantially greater exposure to one of India’s biggest private lenders.