Kotak Mahindra Bank’s Board of Directors has approved a split of the equity shares. In an exchange filing, the bank said approved a split of one equity share of face value of Rs 5 into five equity shares of face value of Rs 1 each.
After the share split arrangement, the bank has divided 280,00,00,000 shares of face value of Rs 5 into 1400,00,00,000 shares of face value of Rs 1. The action does not affect the total value of the shares held by the shareholders.
The bank stated that the proposed stock split requires further approval from the Reserve Bank of India and regulatory authorities before implementation. The bank added that the scheme will be implemented within two months from receipt of all regulatory/statutory approvals, as well as the members’ approval.
What is stock split?
A share split is a corporate procedure where the company issue new shares to increase the number of shares held by the shareholders. The share split increases the trading liquidity of the stocks, making more shares available and affordable to trade.
Earlier in 2010, Kotak Mahindra Bank carried out a share split, reducing the face value of equity shares from Rs 10 to Rs 5. In 2015, the bank also issued bonus shares in a 1:1 ratio.
