India's largest bank, State Bank of India (SBI), will sell a stake of 3-5% in its general insurance subsidiary SBI General Insurance in the current financial year to 31 March 2019.
SBI chairman Rajnish Kumar told the media, “We are in an active mode to unlock value in our subsidiaries this year.”
SBI General is a joint venture between SBI and Australia's IAG where the bank holds a 74% stake and IAG holds the remaining 26%.
SBI General Insurance posted its first-ever underwriting profit in the financial year ended 31 March 2018 (FY2018). This amounted to INR320 million ($4.7 million). Its net profit soared by 160% to INR3.96 billion on the back of a one-time gain of INR1.31 billion, reports Moneycontrol.
After the sale of the strategic stake in the insurer, there are plans to launch an initial public offering.
SBI is also the promoter of SBI Life Insurance which was listed on the stock exchanges last year.