The Reserve Bank of India turned down a proposal by the country’s largest bank to increase its stake in an institutional equities joint venture with a local unit of Investec Plc, according to people familiar with the matter.

SBI Capital Markets Ltd, an arm of State Bank of India , had sought the central bank’s approval to increase its shareholding in the partnership to around 40 per cent, from about 20 per cent, the people said, asking not to be identified discussing private information. Concerns centred on duplication of businesses within the wider group of SBI companies, one of the people said.

The regulator has asked SBI to either move to full ownership or else ensure compliance with proposed rules on financial entities, the person added. Representatives for the RBI, SBI and Inves

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