Business
SBI to dilute stake in life insurance wing by 10 percent
Mumbai, March 31
Following passage of the law
increasing the maximum limit of foreign direct investment in the
insurance sector from 26 percent to 49 percent, the State Bank of India
(SBI) on Tuesday said it is reducing its existing stake in SBI Life
Insurance by a maximum of ten percent.
"The Executive Committee
of the Central Board (ECCB) has on March 30, 2015 authorised divestment
of SBI's stake in SBI Life Insurance Co. Ltd. by upto 10 percent," the
bank said in a regulatory filing with the National Stock Exchange.
SBI
Life Insurance is a joint venture between SBI and French insurer BNP
Cardif where SBI has a 74 percent stake with the 26 percent holding
belonging to the foreign partner.
Last week, SBI, India's largest
bank, said it would also be reducing its existing stake in the general
insurance venture, SBI General Insurance from the present 76 percent to
51 percent. It is likely that stakes of the foreign partner for this
venture, Insurance Australia Group would rise from 26 percent to 49
percent.
From April to December last year, SBI Life Insurance's
net profit grew by 14 percent to Rs.615 crore while SBI General
Insurance suffered a loss of Rs.63 crore for the same time period.
The life insurance wing has an authorised capital of Rs.2,000 crore and a paid-up capital of Rs.1,000 crore.